The state of New Hampshire has thus far resisted the siren’s call to broad-based taxes. Proposals to enact an income tax or a sales tax have spelled doom for many a gubernatorial candidate through the years. While our state still spends much more than it should, a degree of caution is generally exercised when approaching budgets. Because we lack a broadbased tax, every dollar is precious, as the so-called "revenue streams" are few, and very personal. There are faces attached to the taxpayers who do pay monies to the state and those who spend those dollars.
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The following piece on the state of broadbased taxation nationwide caught my eye:
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WASHINGTON, Aug. 14 /U.S. Newswire/ — Today, Americans for Tax Reform (ATR) released a study which shows a fundamental transition in state tax policy as lawmakers have faced changing state economies and taxes as a major campaign issue. The paper reviews 25 years of state tax data to detail its findings and can be accessed on ATR’s website:http://www.atr.org/content/pdf/2006/august/081406pb-statetrends%20_2_.pdf.ATR’s study of 25 years of state tax data finds several key points: 1) Tax increases are shrinking (particularly in recessions); 2) Tax cuts during periods of economic expansion are becoming more popular; 3) States are turning away from income taxes to targeted tax increases, such as tobacco taxes, and toward other forms of double taxation; and 4) States with high tax burdens continually lose residents and their income to lower tax states.."What we see in this study is good news along with red flags for the future," said taxpayer advocate Grover Norquist, president of Americans for Tax Reform. "State lawmakers have seen that voting for higher taxes means voting themselves out of office and forcing their residents and businesses to move to low- tax states. In the last recession lawmakers avoided broad-based tax increases but felt safe picking on certain constituents to fund rapid entitlement spending.".The shifts evident in ATR’s study stem from the post-1990s recession when state elected officials were voted out of office in response to substantial tax increases enacted. The election served as a key lesson and the new governors and lawmakers seized the opportunity to cut taxes as the nation entered a sustained period of economic expansion.."What we used to see in the states is a recession with steep broad tax increases followed by an expansion with more tax increases and enough spending to go around to make France jealous," continued Norquist. "Now we are seeing smaller tax increases in recessions and tax cuts in expansion. But states need to rein in spending and seek market-based healthcare and pension reforms to help ward off future tax increases and to build on the gains of the last 25 years.".Americans for Tax Reform (ATR) is a non-partisan coalition of taxpayers and taxpayer groups who oppose all federal, state and local tax increases.
