Supporters argue reducing the tax by a dime would make New Hampshire more competitive with Maine, Vermont and Massachusetts, while opponents say that even if the state experienced higher sales as a result it still would lose millions of dollars in revenue.
It’s very unusual for states to lower the tax, University of Illinois at Chicago economics professor Frank Chaloupka says. The increase in sales isn’t enough to offset the drop in state tax revenue, he says.
Instead of lowering the tax, states have enacted 100 increases over the past decade, he says.
