Overall Tax Burden in New Hampshire
Most people who value liberty are concerned about taxes, and some have heard that New Hampshire is a high-tax state. The surprising news is that the state’s overall tax burden is not high at all. According to the Tax Foundation, New Hampshire ranks #44 in overall tax burden, and according to Wallet Hub, it ranks #46.
The Granite State’s low tax burden is a result of:
- No state sales tax
- No broad-based income tax
- No capital gains tax
- No inheritance or estate taxes
New Hampshire does collect:
- Property taxes that vary by town
- Auto registration fees
- A 9% rooms and meals tax (also on rental cars)
- A 5% tax on dividends and interest with a $2,400/$4,800 exemption plus additional exemptions
- Taxes on the self-employed above a certain threshold (an 8.2% business profits tax and a .72% business enterprise)
About Property Taxes
The ability to choose one’s property tax rate makes New Hampshire an appealing option for those who value liberty and low taxes. Though New Hampshire ranks #2 in mean property taxes collected on owner-occupied housing, tax rates and assessed values vary greatly from town to town. The median tax amount paid in rural areas can be quite low (see the map to the right).
Those who are willing to commute farther to work and those who don’t need to commute can lower their overall tax burden significantly by shopping for low-tax towns. Free Staters’ favorite low-tax towns include Berlin, Croydon, Hebron, Holderness, Moultonborough, and Tuftonboro. See understanding New Hampshire property taxes and our real estate column for more information.
A Thriving Economy
New Hampshire’s robust economy boasts the 4th lowest unemployment rate in the country. The state ranks #7 in the State Business Tax Climate Index for 2017, with no tax on machinery, equipment, or inventory.
The combination of a high median household income (ranked #7) and low individual tax burden creates conditions for residents to thrive, with the lowest percentage of residents and children living in poverty.
New Hampshire residents rank #1 in financial literacy. The state boasts the highest per-capita Bitcoin usage, with an active cryptocurrency economy and the longest running crypto meeting in the world. A 2017 law exempts digital currency traders from the state’s money transmission regulations.
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