On Oct. 21, the chairman of the House Ways and Means Committee held a forum on taxation in New Hampshire. I found some of the facts and projections most interesting. Here are some of the facts presented by two economists and one demographer.

The good news for us is that New Hampshire has the lowest tax burden and is the safest and healthiest state in the nation. The bad news is that we are an aging state (the fourth oldest). Our population is deficient in the percentage of citizens in the work force between the ages of 30 and 40. While we have a low overall tax burden, we have high business taxes.

New Hampshire is, by far, the state most dependent on the property tax as the primary income source. The advantage is that citizens pay this tax once or twice and are well aware of the expenditure of their money, as contrasted with a sales tax, which is paid out a little at a time. Second, the property tax is a stable revenue source and does not change greatly in good or bad economic times, as is the case with an income or sales tax.

Click for Editorials & Op-Eds

Enter the caption

There was consensus among the three presenters that enacting an income or sales tax was not the solution. An income tax would result in the exodus of the elderly and higher-income residents; these are the individuals who encourage business startups and pay the largest percentage of interest and dividend taxes. Other states have tried to lower property taxes with broad-based personal taxes or casino gambling without success, except to increase the exodus of wealthier or senior citizens.

The answer is two-fold. First, we need to attract more industry as well as educated, work-force age citizens to our state. This will result in better demographics and continued growth in state business tax income, our greatest source of revenue. More well-paying jobs will keep our children and grandchildren in the state and stop the exodus of our working-age population. But business tax revenue alone will not result in a fiscally stable state.

Second, a major effort must be made for the state and municipalities to drastically cut spending. In the past two legislative terms, the state budget has increased more than 25 percent. We must reorganize state and local government. Major savings can be obtained without affecting services.

One example is the reduction of school administrative costs by consolidating the school administrative units. Another is by eliminating duplicative county functions or even eliminating county government. And major cost reductions can be achieved in each state agency. All state and county departments should be required to evaluate and prioritize the programs in departments.

If we don't make a concerted effort to encourage business growth and reduce spending, New Hampshire will become one great retirement home with an ever-diminishing quality of life.

After reading this, you might say, "You politicians needed a forum of experts to tell you this?"

.

Robert H. Rowe is a Republican state representative from Amherst.