Editor’s Note: This week we welcome Patrick Hynes as a new bi-weekly contributor to the New Hampshire Sunday News. He is president of Hynes Communications and lives in Laconia.
The current pandemic requires the New Hampshire Legislature to socially distance itself from the decision making process as it regards the public purse.
“Due to the COVID-19 pandemic, the General Court has suspended all legislative activities until further notice,” the Legislature’s website reads.
We can all breathe a sigh of relief then, eh?
Not so fast. Five months (and counting) of suppressed economic activity has the state pulling in far less revenue than planned. The General and Education Funds together fell $142.5 million short in Fiscal Year 2020. Gov. Chris Sununu has warned that the budget shortfall by the close of Fiscal Year 2021 could be as high as $600 million.
Make no mistake — COVID-19 is fully responsible for the budget hole. In March, state revenues came in right on plan. Then the pandemic robbed state coffers of their largest sources of revenue. It’s tough to bring in rooms-and-meals tax revenue when hotels and restaurants are closed or operating at reduced capacity. Business taxes don’t yield much when the U.S. economy gets shut down.
Now Republican leaders have a warning for working men and women throughout the Granite State.
“One of the biggest issues the next Legislature will face is the pressure to pass an income tax,” argues Republican state Sen. Jeb Bradley. “An income tax would undermine New Hampshire’s competitive advantage among the 50 states and would be a blow to hardworking men and women and businesses trying to recover from the pandemic.”
As Gov. Sununu told radio host Jack Heath, “If you put Democrats in the House and the Senate, you’re getting an income tax.”
Indeed, New Hampshire’s working families are certain to see the income tax fight of their lives next year, provided their roots in the Granite State reach no further back than the autumn of 1972. That’s when Mel Thomson defeated fellow Republican and incumbent Governor Walter Peterson in the primary and went on to win the general election. Along with Union Leader Publisher William Loeb, Gov. Thomson wielded his “Ax the Tax” slogan as a weapon against “Old Broad Base,” the anthropomorphized cartoon money bag Loeb used to symbolize the sinister broad-based income or sales tax.
Since then, if you wanted to be governor of New Hampshire, you took the Pledge against a broad-based income or sales tax.
It’s not altogether clear who has taken the Pledge in 2020. The Coalition of New Hampshire Taxpayers website contains a list of Pledge takers, but it’s from 2018. Sununu obviously signed the Pledge then and his signature still stands.
Democratic gubernatorial hopeful Executive Councilor Andru Volinsky refused to sign it, offering instead his own vague, makeshift pledge that reads suspiciously like a commitment to impose a broad-based tax on New Hampshire families.
Gubernatorial candidate and Senate Majority Leader Dan Feltes, with breathtaking double-speak that betrays contempt for taxpayers and the electorate, claims to have taken the Pledge even after he sponsored a measure to allow the state to withhold .5% of wages from workers’ paychecks.
“New Hampshire has a revenue problem, not a spending problem,” Feltes has said. “And I don’t think it’s fiscally prudent to take off the table any revenue option.”
If your dog can hear the frequency of that whistle, he must be a tax-and-spend Democrat.
Sununu vetoed the Feltes bill, correctly deriding it as an income tax. Indeed, as Sununu sees it, the choice for voters in 2020 is obvious. “Let’s be very clear: every Democratic state senator voted for an income tax,” he told Heath.
The stakes in the November election could not be higher. New Hampshire has a lot to lose. U.S. News & World Report ranks the Granite State as the nation’s second best overall. Wallet Hub says we have the lowest overall tax burden in the region. According to the U.S. Census Bureau, we have the lowest poverty rate in the country.
These superlatives are the results of wise policy choices. They are now in jeopardy. “An income tax would be destructive of everything we have built for over half a century,” Bradley says.
COVID-19 has disrupted our lives. We must not let it be an excuse to disrupt our way of life.