New Hampshire's value-added tax and its effects on state revenue

Art Sum

Kenyon, D. (1996). A new state VAT? Lessons from New Hampshire.

National Tax Journal 49(3): 381-99.

This article is written in the context of New Hampshire's shifting revenue needs and its attempt to address those needs through the imposition of a new type of tax. Uncertainties regarding this tax and the misconceptions or confusions regarding value-added provided the background and impetus for this research and an objective examination.

The objective of the research and the article publication was to create a better understanding of the VAT/BET that New Hampshire employed as a novel means of generating necessary tax revenue, and to discover and clearly render how such a tax might impact both state revenue streams and business performance and profitability. In other words, the research objective was primarily explanatory or descriptive rather than experimental.

Research Design:

Because this article does not present experimental research as such, it does not have a precise design in the traditional sense. Its setting and participants clearly defined as the state of New Hampshire and the businesses therein, including the budgetary needs and other financial details of the state and these businesses, which suggests some aspects of the design: the research was a comprehensive descriptive study of the new taxation policy in New Hampshire. Beyond this, however, the manner of data collection and analysis is not so much designed as describing what must necessarily be described, namely how the tax operates in reality.

Results/Findings: