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New Hampshire has the Sixth Lowest Tax Burden in the Nation for 2011

Nov 12, 2013


In Fiscal Year (FY) 2011, New Hampshire collected $5.3 billion in state and local taxes. While this is an impressive sum of money, it tells us little about whether or not the average New Hampshire taxpayer can afford this level of taxation.


As shown in the charts below, New Hampshire’s state and local tax burden (tax collections divided by personal income) was the 6th lowest in the nation for FY 2011 at 8.7 percent—or 16.6 percent below the national average of 10.5 percent. Not surprisingly, the tax burden has grown modestly over time by 22.1 percent to 8.7 percent in FY 2011 from 7.1 percent in FY 1950.


New Hampshire is also the only state in the U.S. where an individual can enjoy not paying any state or local personal income tax, state or local sales tax, and no local property taxes. As such, New Hampshire may be the home of the only tax havens left in America. Alaska comes the closest to tax haven status, but they allow towns to levy their own sales tax—which is the equivalent to a state-wide 1.69 percent sales tax according to the Tax Foundation.


According to 2012 property tax data from the New Hampshire Department of Revenue (pdf), there are 20 towns with a property tax mill rate of zero. Another three towns have a property tax mill rate under five. The google map below shows the town and related property tax mill rate.


Of course, there is a small problem if you want to move to one of these tax havens—many of these towns are remote and/or mountainous with few people. Neither homes nor land come up for sale very often and when they do they command a price premium. For example, in Millsfield, New Hampshire one could buy a farmhouse and 405 acres combined for $1,199,900 or separately with the farmhouse and 5 acres for $349,900 and the 400 acres for $850,000.


One caveat in that recent developments in New Hampshire have resulted in the enactment of a state-wide property stemming from a ruling by the State Supreme Court on education funding. The rate in 2010 was set at 2.19 mills, so it’s not too onerous. This is the only thing preventing an individual from not having to face any of the big three taxes levied in America today.

 

Click here to view tax burden data.


New_Hampshire_Tax_Burden_1950_to_2011.jpg


New_Hampshire_Tax_Burden_2011.jpg

 


View New Hampshire Tax Havens in a larger map



Category: Tax Burdens

J. Scott Moody

Scott has nearly 20 years of experience as a public policy economist. He is the author, co-author and editor of over 180 studies and books. His professional experience also includes positions at the American Conservative Union Foundation, Granite Institute, Federalism In Action, Maine Heritage Policy Center, Tax Foundation, and Heritage Foundation.


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