House kills R&D tax credit
The House defeated two Senate bills Thursday that would have given businesses $19 million in tax breaks.
A bill to offer $1 million in credits against the business profits tax for research and development costs failed in a 192-107 roll call vote.
Supporters of Senate Bill 380 said it would create high-paid high-tech scientific jobs in the state, help keep New Hampshire companies at the cutting edge of their fields and slow or reverse the loss of manufacturing jobs. The bill capped any single firm’s credit at $100,000.
Rep. Peyton Hinkle, R-Merrimack, led the floor fight for the bill, saying 40 other states offer a similar tax break.
“The business profits tax is down $22 million from what we projected,” Hinkle said. “Something is happening there. We don’t want to be unattractive to start-ups, and high-tech firms want to be near other high-techs. It’s too bad the paper mills didn’t have this tax break. They might have stayed in business.”
Rep. Ben Parker, R-Londonderry, chaired the House Ways and Means subcommittee that said the bill would do little to spur job growth. He noted the state’s 3.6 percent unemployment rate and said New Hampshire already has a big edge in economic development through its lack of a sales or income tax.
“We heard from 20 experts,” Parker said. “They could not provide even one study to prove that R&D credits created a specific number of jobs. The empirical evidence shows it doesn’t make a difference. We attract jobs because we have the lowest tax burden.”
SB 397, which would have given firms $18 million in one-time tax credits for energy costs, died in a voice vote as part of the consent agenda.
Prime sponsor Chuck Morse, R-Salem, the Senate Finance chairman, had dropped his support, and the House Ways and Committee opposed the bill, 19-0.
Lawmakers said it was a bad idea to give 36,000 firms a $500 tax credit for up to half their oil, gas or electric bills.
State economic development director Stuart Arnett spoke for the bill at its public hearing.
The Business and Industry Association, the New Hampshire High Technology Council and several chambers of commerce were advocating for the bill as well. – CHRIS DORNIN/GOLDEN DOME NEWS