GST Testimony for Education Tax Credit

Feb 27, 2019 by

GST Testified against HB 632, which would eliminate the Education Tax Credit.
This bill removes the application of the education tax credit in RSA 77-G to taxes due under the interest and dividends tax, and on July 1, 2020 deletes the education tax credit program.
Click here for status information and a link to read the bill.

The NH House Ways & Means Committee met on 2/5/19 to hear testimony on HB 632.
GST Secretary Dan McGuire offered the following statement.
We urge you to recommend HB 632, repealing the Education Tax Credit, inexpedient to legislate.

The Education Tax Credit (ETC) is beneficial to everyone involved because it is completely voluntary. Donors, parents, students and their schools all like the program. If it wasn’t right for them they wouldn’t participate. Elimination of the program would necessarily force them into worse alternatives (from their point of view).

Revenue Dept. reports for 2018-2019 and 2017 (1st and 2nd organizations) show ETC donations of $1,042,200 (so far) and $854,326, respectively. The tax credit amounts are 85% of those figures. While the program caps donations at $6M per year, only about $1M per year are currently being used. Those are insignificant numbers compared to the approximately $1B per year that the state budget spends on K-12 education (see here), and $3B a year total government spending on K-12 (see here).

A simple calculation from the 2017 reports cited above shows that the average ETC scholarship is only $2,148 per student. When compared to the $16,000 cost per pupil of the public schools, or even the $5,500 per pupil state aid (both from HB 632’s fiscal note), it is easy to see that the scholarships save money.

It is for these reasons we oppose HB 632.

Dan McGuire, Secretary
Granite State Taxpayers

Click here to find your Legislators. Tell them to oppose this legislation!

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