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Correcting the record

On many occasions, I've proudly proclaimed New Hampshire as "the only state without a sales or income tax." A couple people took issue with me, citing Alaska as a counterexample. I finally got off my butt and did a little digging.

New Hampshire does, indeed, have no sales tax and no state income tax. We do have a tax on interest and dividends, but actual salaries are not taxed.

Alaska also has no state-wide sales or income tax. However, 89 municipalities in The Last Frontier do have their own sales taxes.

While on paper, Alaska's might be a bit more generous, in practice I think I prefer New Hampshire's system. Of course, we don't have a jillion gallons of crude oil to support our economy, either -- not that we're jealous.

Nor are we jealous that we have Maineiacs, Massholes, Vermonsters, and Hosers for neighbors, while Alaska just has the Hosers -- and those in relatively short supply that far north. They do have the Russians right on their doorstep, though, and that counts for a lot.

Comments (11)

Does New Hampshire have a p... (Below threshold)

Does New Hampshire have a property tax?

Is Alaska still paying its ... (Below threshold)

Is Alaska still paying its citizens a portion of the revenue the state earns from oil production? That used to be a pretty tidy sum, back in the day...

Alaska still pays out cash,... (Below threshold)
Tee Jay:

Alaska still pays out cash, about $1,000 per person to residents. That cash comes from the investment earnings of the "Permanent Fund", not from current oil revenue.

In Oregon, we don't have a ... (Below threshold)

In Oregon, we don't have a sales tax, but our property and state income taxes are through the roof.

Well, here in CA, I am prou... (Below threshold)
sammy small:

Well, here in CA, I am proud to say that we have a 9.3 percent state income tax (top bracket), 8.25% sales tax (LA areea), 1.25 percent state/local property tax, 18 cent per gallon gasoline tax, 800 dollar per year disability payroll tax, and many more small taxes I can't even quantify.

Maybe we qualify as the most taxed.

re: local taxes.Do... (Below threshold)

re: local taxes.

Don't forget to look for a "business and operations" (B&O) tax, usually levied per employee. In that form it is an individual income tax which is paid by the employer, and as such is slightly hidden (though it is certainly reflected in lower salaries).

e.g. Washington State has no income tax, but one of the highest B&O taxes in the country, putting it near the top in the ratings of unfriendly-to-business states. These taxes, disability insurance managed in a way that encourages a corrupt level of feather-bedding / socialism, and specal assessments drove Boeing out of Washington to Illinois (to say nothing of having only minority party representation in Congress, a recipe for continued decay).

I'm curious, Jay. Why woul... (Below threshold)
Starboard Attitude:

I'm curious, Jay. Why would you prefer New Hampshire's system to Alaska's?

Why prefer a system that taxes only interest and dividend income? Isn't that a very skewed disincentive against investment in your state? Is that why there's not much capital intensive industry there?

That seems like a bizarre activity to single out for taxation. That, combined with your property taxation, seems to disproportionally hit those who take risks and build job-producing enterprises.

Your system is designed to make New Hampshire a state of instant consumers--of goods produced elsewhere. How sustainable is that?

Don't forget, Alaska is in ... (Below threshold)

Don't forget, Alaska is in range of NK missiles (once they work the kinks out of them that is). So be jealous of their oil (I live in Texas and even Texas is jealous of Alaska's oil) but don't forget the down side.

I have an uncle who owned a business in Alaska and one in Hawaii (just not a continental type of guy). His businesses were seasonal, so he spent summers in Alaska and winters in Hawaii. Of course since both are in range of the Kim blue light special, you might think that he would be in danger. But no, he sold his business a while back and is not doing missionary work in Indonesia (which is dangerous regardless of NK missiles).

Heh, don't be too concerned... (Below threshold)
Starboard Attitude:

Heh, don't be too concerned for Alaskans and the NK missle threat.

Geographically, if Alaska were superimposed over the contiguous 48 states, it would reach from Florida to California, from Wisconsin to Texas. It covers a huge area, yet has fewer residents than the numbers that attend free concerts in Central Park. In other words, the odds of being affected by such a strike are minimal.

Even if a missle struck within the city limits of Alaska's capital, Juneau, consider this: The city limits encompass 3248 sqare miles, yet only about 25,000 live there.

The low population density works in its favor.

Last year I kept 82.9% of m... (Below threshold)
John S:

Last year I kept 82.9% of my take home pay, so I can afford the NH property tax. When I lived in Maryland, the same $100,000 salary resulted in more than $40,000 of federal, state, local income tax, county property tax, plus a hefty sales tax on every purchase. Then there were the $100 dog tags, $3,000 auto insurance bills. etc., etc.

And?So New Hampshi... (Below threshold)
Starboard Attitude:


So New Hampshire takes less than Maryland. Big deal. My point is not about the quantity of its revenues--only the source.

New Hampshire's tax scheme penalizes investment when it need not. It could siphon the same amount using a more neutral tax scheme, which might help the economy.

Furthermore, I'm not sure how local income tax, county property tax, local sales taxes, dog tags or auto insurance fit into conversation. Aren't we talking about state taxation?






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