May 27, 2015 5:53 PM
CONCORD - Planet Fitness officials say they will move their headquarters out of state to avoid paying high taxes when they go public.
Senate Republican leaders today propose and a panel endorsed a tax break for any firm in the same position.
The change would exempt the ownership of a limited business partnership from having to pay taxes on profits from the sale of shares made when it took the company public.
Backing the Planet Fitness bid at a public hearing on the tax break was former Gov. Craig Benson.
Benson failed to mention he had served on the company’s board and recently was described in published reports as "one of the leading Planet Fitness Club owners.”
Bill Ardinger, a leading tax law expert who’s lobbied on such matters, called the tax treatment a "poison’’ to job growth in the state.
"The fact is I have advised companies to move out of New Hampshire to avoid the risk. That’s a terrible result. It makes you want to slit your wrists,’’ Ardinger said.
But Revenue Commissioner John Beardmore warns this could cost the state treasury much more as other large sophisticated firms also take advantage of this break.
"I think the word loophole is overused and I try not to use it but this could be one,’’ Beardmore said.
Senate President Chuck Morse says any elected leaders should be responsive to this request.
"Any citizen who called and said they were moving 500 jobs to another state, myself, the governor, the speaker would have reacted,’’ Morse said.
Company officials said the jobs lost would be about 200 at their headquarters in Newington.
But a key Senate Democrat says acting this late in the session on such a complicated tax change isn’t wise.
"Any time you do a carve out at the 11th hour there are ramifications,’’ said Sen. Lou D’Allesandro, D-Manchester.
The Senate Finance Committee endorsed the change, 4-2, along party lines.
Morse stressed the Senate needed to pass something to keep this issue alive and agreed it will take a few weeks of negotiation to perfect it.
"I’m not sure we are going to be able to get this done but we should make the effort,’’ Morse added.
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