NH Democrats Renew Income Tax Push, but The Numbers Show It Won’t Fix Property Taxes

CONCORD, NH — Former Democratic Executive Councilor Andru Volinsky is once again pushing for a state income tax to fund public education in New Hampshire, reigniting debate over whether such a tax could ease the state’s notoriously high property taxes. But critics say the math — and the experience of other states — doesn’t support the idea.

In a recent op-ed published on the Left-Leaning site InDepthNH, Volinsky called for a 3% income tax with deductions for families earning up to $125,000, paired with a modest statewide property tax. He argues the plan would generate up to $2 billion in sustainable revenue and significantly reduce local property taxes, which currently fund the bulk of New Hampshire’s $4 billion K–12 education system.

Volinsky frames the move as necessary to meet the state’s constitutional obligation to adequately fund education.

But a closer look at the numbers reveals a gap between the promise and the potential outcomes. The average New Hampshire household pays $6,372 annually in property taxes, with between 55% and 80% of that — or $3,500 to over $5,000 — going to public schools. By comparison, a 3% income tax on the state’s median working household income of about $100,000 would raise roughly $3,000 per year. For a household earning $125,000, it would generate around $3,750.

Household Income	3% Income Tax	Average Property Tax	School Portion (55–80%)
$100,000	$3,000	$6,372	$3,505 – $5,097
$125,000	$3,750	$6,372	$3,505 – $5,097

Even with full implementation, the proposed income tax would fall short of replacing the education portion of the property tax burden for many families — and it would not address the remainder of property taxes that fund police, fire departments, roads and other municipal services. As a result, most homeowners would still face high property tax bills while also taking on a new income tax.

Critics also point to Connecticut as a cautionary tale. In 1991, the state enacted a broad-based income tax with the goal of reducing heavy reliance on property taxes as Volinksy suggests. Today, Connecticut’s property tax burden remains one of the highest in the nation. The effective property tax rate is around 1.48% — third highest in the U.S. — and higher than New Hampshire’s 1.41%, despite Connecticut also having a graduated income tax reaching nearly 7%.

A 2020 Yankee Institute report found that Connecticut’s average property tax mill rate has increased by 29% since adopting its income tax. The report noted that Connecticut’s property taxes are among the highest nationally and have continued to grow despite the introduction of an income tax.

Volinsky, a longtime advocate of school funding reform, has argued that New Hampshire’s system is regressive and overly reliant on local wealth. He has cited a recent court ruling requiring the state to double its education contribution as further justification for new revenues.

While his plan proposes significant exemptions for lower- and middle-income households, the overall structure would still result in thousands of dollars in new taxes for many families without guaranteeing meaningful relief from property taxes.

As the Legislature prepares for the next session, the debate over how to fund education — and whether an income tax belongs in the Granite State — is once again front and center. Whether Volinsky’s proposal gains traction or is rejected as insufficient to address the property tax challenge remains to be seen.