All year long New Hampshire Democrats have been whining about how cutting New Hampshire’s business taxes was a hand out to the rich. Corporate bailouts. The standard socialist-Democrat class warfare rhetoric.
Back in the real world, these tax cuts have produced record job growth, wage growth, and record labor force participation. Regular folk are working and earning more. The tax cuts have also produced millions in extra revenue for the government. Monies that came as a result of lower taxes.
Related: New Hampshire Democrat Wants to “Revoke …Tax Cuts Businesses Didn’t Ask For”
Drew Cline writing at Josiah Bartlett paints the uncomfortable picture for the tax and spenders.
As we pointed out in October, in the three full fiscal years since 2016, when the first round of the tax cuts took effect, business tax revenue exceeded budget expectations by $319.5 million.
That trend has not subsided. In the current fiscal year, which started July 1, business tax revenues are $58.2 million (36.6 percent) above plan and $42.8 million (24.5 percent) above the prior year.
More than 1/3 of $1 billion in unanticipated business tax revenue has funded a lot of additional state spending. And that puts the new legislative majority in an interesting situation.
It’s uncomfortable because Democrats objected to the tax cuts because there were going to throw the budget off by 100 million dollars. As I noted here, they did. In the other direction, and then some. So the uncomfortable picture looks like this.
Democrats Will Raise Taxes
Democrat objections to tax cuts in New Hampshire (and everywhere, actually) turn on the well-worn narrative that Republicans are risking money that belongs to the government (for the people’s business™) to reward corporate cronies. You, after all, did not build that.
Will the new (Democrat) majority risk that revenue by raising rates, or will leadership decide to leave well enough alone?
Business tax cuts have helped raise New Hampshire to No. 6 on the Tax Foundation’s Business Tax Climate Index. No other New England state is in the top 25. Vermont is a lowly 41. New Hampshire is a lone outpost of business tax sanity in New England, which is clearly helping our economy.
But a healthy economy is not what Democrats want. They want more government. So, as I pointed out here, expect them to do what they always do. Use the positive growth of tax cuts to overestimate revenue. They will spend that to grow government. When revenue falls short by design, they will use that as an excuse to raise taxes and kill the prosperity. (With the prerequisite smattering of fees and taxes on everything else in the meantime See: beer tax, paint tax, transfer tax, etc.)
I guarantee it.
Related: One of Life’s Certainties – New Hampshire Democrats Raise Taxes
