InDepthNH.org (https://indepthnh.org/author/phil-sletten/)
These challenges will likely be compounded by the planned disappearance of a key tax revenue source, the Interest and Dividends Tax, next year under current law.
While the median household income increased, the poverty rate held steady at 7.2 percent, reflecting that nearly 100,000 New Hampshire residents had very little income despite purchasing power growing for the median household.
Recently released federal data indicate that county, city, and town governments in New Hampshire likely have millions of flexible, unspent federal dollars that must be committed to a purpose before the end of the year.
However, about 87 percent of that total surplus amount was generated by two revenue sources that are likely to disappear in future years.
New Hampshire’s population grew by about 23,400 (1.7 percent) between July 2020 and July 2023, according to estimates from the U.S. Census Bureau.
Key sources of revenue growth in recent years, specifically the State’s business taxes and the Real Estate Transfer Tax, have been slipping behind expectations, and the revenue sources currently generating surpluses are likely to be temporary.
With nearly 100,000 New Hampshire residents living in poverty, or approximately 1 out of every 14 in the state, recent inflation and the end of federal assistance related to the COVID-19 pandemic are impacting the ability of many Granite Staters to afford basic necessities, including food.
Combined state and local taxes in New Hampshire require residents with lower incomes to pay a larger percentage of their income than those with higher incomes.
The New Hampshire Senate Finance Committee’s version of the State Budget proposes retaining most of the key provisions of the House’s version of the State budget, with some changes made to food assistance for school children, Medicaid Expansion, funding for local public education, and contribution to the New Hampshire Retirement System.