The Hippo

HOME| ADVERTISING| CONTACT US|

 
Sep 1, 2014







NEWS & FEATURES

POLITICAL

FOOD & DRINK

ARTS

MUSIC & NIGHTLIFE

POP CULTURE



BEST OF
CLASSIFIEDS
ADVERTISING
CONTACT US
PAST ISSUES
ABOUT US
MOBILE UPDATES
LIST MY CALENDAR ITEM






Promoting innovation
State shows support for business community

03/28/13



3/28/2013 - With an eye toward strengthening the state’s economy, Gov. Maggie Hassan signed off on legislation last week that would increase the state’s research and development tax credit from $1 million to $2 million. 

 
“It is extremely important,” said Adrienne Rupp, vice president of communications for the New Hampshire Business and Industry Association. “There has been great demand since it was implemented. The Department of Revenue gets more requests than they can hand out in tax credits.”
 
As it stood, businesses could apply for credits against qualifying research and development expenditures with a maximum credit of $50,000. Last year, 111 businesses applied for credits, with 58 qualifying for credits. Those 58 businesses split the $1 million credit, with each business receiving a $12,000 benefit, said Dennis Delay, an economist with the New Hampshire Center for Public Policy Studies. 
 
Supporters want businesses to be able to get closer to the $50,000 maximum benefit, particularly since there appears to be considerable interest in the program. Nationally, 43 states have some version of a research and development incentive. The closest state to New Hampshire that doesn’t have one is Tennesee, Delay said. 
 
“A lot of the push when it was passed in the first place was that it was an economic development tool that would put New Hampshire on similar footing to other states around us,” Delay said. 
 
Along with doubling the total credit amount, the bill makes the program permanent. The program, which was reestablished in 2007,  is modeled after the federal research and development tax credit program. The bill received strong support in the House and Senate, where it received priority status. 
 
“We know it’s a valuable tool to encourage business development,” Rupp said. “That’s one of the reasons we supported it.”
 
It’s most often talked about as benefiting manufacturing companies and companies in the technological realm, but any company conducting research and development could be eligible for credits, Rupp said. Additionally, the credits promote the creation of quality jobs in the Granite State.
 
“These are the jobs we want in New Hampshire,” Rupp said. “They tend to be high-paying jobs. They require an educated workforce. That’s all good for the state. That’s why we feel the tax credit is so important.”
 
Rupp said the credit makes New Hampshire a more attractive place for companies to expand and locate, particularly given how important manufacturing is to New Hampshire’s economy, Rupp said. 
 
“It just enhances New Hampshire’s attractiveness,” Rupp said. 
 
When the program was re-established in 2007,  Delay said, studies showed the credit program would create 73 jobs and $5 million in gross state product, along with $1.8 million in additional research and development investments. 
 
“So essentially the argument at the time was that if you put in a tax credit of $1 million for a research and development tax credit, you generate $1.8 million in research and development activity,” Delay said. 
 
The tax credit would help create jobs and generate income, but it probably wouldn’t result in extra state revenue. 
 
“It’s a net win for the New Hampshire economy, but it’s revenue-neutral,” Delay said. 
 
In general, that’s what other states have found as well. Programs like this tend to have economic benefits and they pay for themselves, but they’re not so successful that states see a benefit in the form of revenue, Delay said. 
 
But not having it, or not having a competitive program compared to other states, could put New Hampshire at a disadvantage. 
 
“You’ve got to have one because your next-door neighbor has one,” Delay said. “It may create a little economic activity at the expense of the surrounding states.” 





®2014 Hippo Press. site by wedu