New Hampshire reports robust tax collections
(The Center Square) – New Hampshire’s state revenues continue to outperform budget writers’ expectations, with robust tax and fee collections reported in the previous month.
Tax receipts for March totalled $701 million, which is about $24.6 million above the projections for the state’s two year budget, and $33,8 million more than a year ago, according to the state Department of Administrative Services’ monthly revenue report.
The better-than-expected month is likely to have an impact on the state’s ongoing budget deliberations. Gov. Chris Sununu has said the state’s increasing revenue collections have allowed the state to whittle down a projected budget deficit in the next fiscal year from $350 million to $50 million. The latest revenue collections are likely to further reduce the state’s shortfall.
The state collected $116.3 million in business taxes in March, $11.6 million more than the budget plan, and $18.2 million more than a year ago, the report noted. Year to date collections were up by more than $100 million, or 21%, the report noted.
New Hampshire’s hot real estate market continued to see gains in March with the real estate transfer tax producing $12.6 million, or $4.1 million more than budget projections.
Year-to-date real estate transfer taxes – which charges home buyers and sellers 75 cents for every $100 of property value – were nearly $32.8 million above initial estimates.
Tobacco taxes were up $2.3 million over initial projections in March, with about $18.5 million collected by the state.
Beer and liquor revenue, as well as the real estate transfer and communications taxes were all slightly above projections for the month.
Still, the state’s revenue gains were offset by declines in gasoline taxes, and meals and rental tax collections, with less people driving and some businesses closed due to the pandemic.
Collectively, meals and rental taxes for March were $23.1 million, or about $4 million below projections and $3.4 million below the previous year. Year-to-date meals and rental tax collections were down more than 20%, according to the report.
Taxable meals were down by 15.7% and hotels were down by 27% compared to March 2019, according to the state Department of Revenue Administration.
As part of his budget proposal, Sununu has called for cutting the rooms and meals tax from 9% to 8.5 % – the lowest level in more than a decade – and reducing the business enterprise tax from 0.6% to 0.55% to provide relief for businesses and help spur the state’s economic recovery.
The Republican governor also called for phasing out the state’s interest and dividends tax over the next five years, fully repealing it by 2026.
Through March, the state’s highway fund generated $182.1 million, which is down $7.7 million year-to-date. State officials attributed the decline to lower gas tax collections.
Year-to-date, the state has collected $2 billion, which is $127.5 million or about 6.7% above initial budget projections.
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