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Another View: Proposal to raise the gas tax will hurt NH families, businesses

February 18. 2013 5:13PM

One of the most controversial proposals of the current legislative session is House Bill 617, a bill to raise New Hampshire's gasoline tax and vehicle registration fees. This legislation, as proposed, will raise the road toll (more commonly referred to as the "gas tax") and vehicle registration fees for all New Hampshire residents and businesses. It will increase new taxes on all highway users to the tune of $125 million per year and impose more than $1 billion in new taxes the first decade after implementation.

Under current state law, the average annual fees and taxes associated with operating an 80,000 pound truck on New Hampshire's highways total approximately $11,000. HB 617 would increase these fees and taxes by an additional $2,100 per truck, an increase of nearly 19 percent.

As most people are aware, the cost of fuel has spiked dramatically since the first of the year without the addition of any new tax. All signs are that fuel costs will continue to rise. Who does this high cost of fuel affect the most? The impact will be felt by both New Hampshire residents and businesses.

New Hampshire's trucking industry is made up of mostly small, family-owned or medium-sized firms that lack the ability to buy fuel in bulk or negotiate volume discounts that may be available to larger companies. For the average New Hampshire resident or business struggling to make ends meet, filling the tank is already a challenge. This added tax will be like a kick in the teeth.

New Hampshire-based trucking companies were hit particularly hard by the economic collapse of 2008, and many are still struggling to recover. Businesses and residents in the northern part of the state continue to have their livelihoods negatively affected by the loss of business and jobs, and many struggle to simply get through the day. The increased tax burden under HB 617 could easily be the "last straw" for their ability to survive.

The impact of these proposed tax increases will undoubtedly be felt throughout the state labor force as well. For New Hampshire trucking companies, the cost of fuel is now second only to labor costs. Since not all trucking companies are in a position to place a surcharge on their deliveries to cover their increased costs, their only recourse will be to reduce wages, benefits and hours, and perhaps resort to staff reductions and layoffs. Ultimately, all New Hampshire residents will feel the impact of these new taxes in the increased costs of goods and services in order to cover the higher delivery costs. Recently, the board of directors of the New Hampshire Motor Transport Association (NHMTA) met to study this legislation and develop a policy position on how best to fund improvements to the state's highways and bridges. The board decided to oppose the bill for all the reasons previously stated. The board did vote to support the option proposed in the Senate, SB 152, which would fund improvement and maintenance of New Hampshire's highways and bridges as well as many other initiatives through gaming revenue.

Though gaming is not an area that the New Hampshire Motor Transport Association has ever been involved in or supported in the past, this approach is a far better alternative than increasing the tax burden on already struggling Granite Staters and businesses as proposed in the House bill.

Robert Sculley is president of the New Hampshire Motor Transport Association.

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