New Hampshire

New Hampshire has neither state sales tax nor a state income tax, it does levy a flat 8.5% corporate income tax on net corporate income. The state also imposes a full array of excise taxes, on motor fuels, tobacco products, insurance premiums, public utilities, alcoholic beverages (the state controls all sales), amusements, pari-mutuels, and many other selected items. Interest and dividend income are taxed at 5%, and there is an 18% inheritance tax for non-linear inheritors. New Hampshire's estate tax is tied to the federal exemption for state death taxes, and is therefore set to be phased out in tandem with the phasing out of the federal estate tax credit by 2007 unless the state takes positive action to preserve an estate tax. New Hampshire's revenue losses from the phasing out of its inheritance tax are estimated at -$7 million for 2002/03, -$9.4 million for 2003/04 and -$31 million for 2006/07. Death and gift taxes accounted for 2.9% of state collections in 2002. Other taxes include various license and franchise fees, stamp taxes, and state property taxes. Most property taxes are collected locally. About 42% (42.1% in 2000) of total state and local taxes are collected locally.

The state collected $1.88 billion in taxes in 2002, of which 32% came from the selective sales taxes, 26.6% from state property taxes, 20% from corporate net income taxes, 9.1% from state license fees, and 5.3% from stamp taxes (documentary and stock transfers). In 2003, New Hampshire ranked 49th among the states in terms of state and local tax burden, which amounted to only 6.6% of income.

The following table from the US Census Bureau provides a summary of taxes collected by the state in 2002.