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NH House committee shows scant support for raising taxes

State House Bureau

January 23. 2013 10:58PM

CONCORD - Another attempt to require a supermajority of lawmakers to pass new or increased taxes and fees found little support Wednesday before the House's tax writing committee.

CACR 1, a proposed constitutional amendment, would require a three-fifths majority of the House and the Senate to approve new or increased taxes and fees.

A nearly identical proposed amendment failed to garner the needed three-fifths majority of the House to be placed on the general election ballot last year when Republicans held large majorities.

The House Ways and Means Committee also heard proponents of changing the constitution to allow graduated taxes Wednesday.

"When you're taking your neighbor's money and using it for something," said Rep. Jordan Ulery, R-Hudson, the prime sponsor of CACR 1, "there needs to be a good reason."

He said the amendment would require lawmakers to document the need for the tax or fee increase.

"This is an essential element that needs to be added to the constitution," Ulery said, "because too often we have turned to gimmicks, one-time fixes and selling land to balance the budget."

But others testifying on the proposed amendment disagreed, calling it a gimmick of its own.

"This is an invitation to turn New Hampshire into California," said Rep. Peter Schmidt, D-Dover. "California is in terrible fiscal shape because it requires a supermajority of the legislature to pass a budget."

Passing a budget is difficult as it is, he said, and the proposed amendment would make it even more difficult.

Jeff McLynch of the N.H. Fiscal Policy Institute said the proposed amendment would be bad for the state, which has one of the lowest tax burdens in the country.

He said the amendment would undermine the state's democratic institutions and would allow a small group of legislators to block important priorities.

The proposal also would increase the state's borrowing costs and harm the pursuit of tax reform, he said.

Disagreeing with Ulery, McLynch said the amendment would increase the likelihood of turning to one-time fixes and accounting gimmicks to address future budget shortfalls.

"This bill attempts to respond to a problem that does not exist," McLynch said.

Although no representative from advocacy group Americans for Prosperity attended the hearing, in a statement the group supported the proposal.

"The people of New Hampshire deserve to have a say in how and if their taxes are raised," said Corey R. Lewandowski, state director of the group's New Hampshire chapter. "CACR 1 will return control to New Hampshire taxpayers while making it more difficult for taxes to be raised due to the political whims of the Legislature."

The prime sponsor of CACR 2, Rep. Charles Weed, D-Keene, said his proposal to allow for graduated taxes, currently forbidden in the state constitution, is an attempt to have a discussion about making the state's regressive tax system more progressive.

"This is a chance to discuss the concept without having a bill hanging in the background," Weed told the committee. "Everyone took the governor's warning to heart so there is no income tax bill out there."

Gov. Maggie Hassan has vowed to veto any income or sales tax that arrives at her desk.

Weed argued the state's reliance on property taxes to fund 60 percent of government is regressive and has no connection to a person's ability to pay.

The committee will decide on its recommendations for the two proposed amendments Tuesday afternoon in an executive session.



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