Jun 17, 2015 8:09 PM
Landrigan: House-Senate negotiators embrace tax break for all firms that Planet Fitness first sought
CONCORD - The threat of Planet Fitness to get a tax break or leave the state paid dividends Wednesday.
House and Senate leaders endorsed a compromise letting all companies avoid paying state taxes on profits they make after going public.
This fast-moving deal still has a long way to go as it faces an up or down vote by the full House and Senate next week before it can then head to the desk of Gov. Maggie Hassan.
Supporters say making business owners pay a tax once they sell stock, or the entire company outright, makes New Hampshire an undesirable place to be.
"New Hampshire has a provision of its tax code which is punitive to the success of companies," said State Sen. Andy Sanborn.
While Planet Fitness and former Governor Craig Benson made this pitch, they insist this break treats all companies the same.
"We did not talk about any specific company and we did not talk about any former governors," said Sen. David Boutin, R-Hooksett, chairman of the Senate Ways and Means Committee.
Initially some House Republicans balked at it because since 2010, firms paid $22 million under this tax treatment.
But state tax officials admit they could not estimate how much this would cost in the future.
House Ways and Means Committee Chairman Norm Major, R-Plaistow, said this is why he backed the compromise and vowed next year to ask the Legislature to study its effectiveness.
"And they say it’s very difficult to determine because it’s so volatile," Major said.
Critics say at the very least it’s a multi-million tax loss every year.
"What began as a loophole for one former governor and one corporation has expanded into an even bigger loophole," said State Sen. Dan Feltes, D-Concord.
Feltes was one of three on the nine-person negotiation committee that refused to support the deal. House Speaker Shawn Jasper, R-Hudson, replaced two members while Senate President Chuck Morse, R-Salem, replaced Feltes with Majority Leader Jeb Bradley, R-Wolfeboro.
And Hassan criticizes how this change has all come about.
"It came at the very last hour of the legislative session almost literally and it’s very difficult to make good tax policy in a rush at the end of the legislative session," Hassan added.