The New Hampshire tax climate is the crown jewel of New England for business owners and the attractiveness of the overall structure.
The state recently ranked 6th nationally in MaxFilings’ 2019 State Business Tax Climate Index, proving it has been able to mitigate other challenges the state faces in attracting new economic development.
The New Hampshire tax burden for businesses
For starters, New Hampshire has the fewest sales taxes of any state in the country.
Levies are only charged for beer, gasoline and cigarettes.
This is accompanied by the lack of a state income tax.
Furthermore, businesses don’t face capital gains taxes or inventory taxes at the state level.
Even a state that goes by the motto “Live Free or Die” has to fund its government somehow though, and New Hampshire seeks its public revenues via high corporate taxes and high property taxes.
New Hampshire’s already high corporate rates are made more stringent by limits on the ability to carry forward losses.
The state has recently sought to provide some relief and attract new business by cutting its business profits tax.
The bigger challenges New Hampshire businesses face comes from factors beyond taxation.
Energy costs are high.
And with a state population just over one million, New Hampshire ranks low on the totem pole in terms of the state’s available workforce.
While those challenges are real, they do have to be taken in regional context.
All of New Hampshire’s neighbors face the same problem with the cost of heat in the winter.
It still hurts when competing for national or international businesses, but an entrepreneur from the area might have more limited geographic options.
All studies regarding the available labor force need to take Boston into account.
The city is just a 45-minute drive from portions of New Hampshire and brimming with college students ready to enter the workforce.
This is just one benefit that comes from access to the broader New England market.
Starting a business in New Hampshire will present unique challenges, but it’s fair to say that the state is doing all it can to be friendly to entrepreneurs.
Is it right for your business? Consider these factors.