Is New Hampshire Friendly to Business?

An Analysis of New Hampshire’s Business Tax Environment
PRS Briefs
PRS Policy Brief 1011-04
Friday, February 18, 2011

This report’s goals are to evaluate how New Hampshire’s tax and incentive structure affects business investment in the state, compare it to other states’, and discuss policies that could enhance business investment in different areas of New Hampshire’s economy. To evaluate New Hampshire’s business environment, we looked at the existing taxes and incentives affecting business in the state. We compared New Hampshire to neighboring states: Vermont, Maine, and Massachusetts, and to other states with similar tax rates and incentives to New Hampshire’s. Once we thoroughly understood New Hampshire’s tax and incentive policies, and how they compared nationally, we incorporated economists’ and academics’ evaluations of different tax levels. Our research suggests that a state should know its specific policy goals before making any tax code changes. There is no perfect tax bundle, rather bundles can be designed specifically to meet particular policy goals such as an increase in small business start ups or increased employment in a struggling county.