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Among New England states, New Hampshire stands out for its lax, and in some cases non-existent, personal and business taxes. This is by design. With the more libertarian approach of no taxes on sales, inventory, capital gains, professional services, or personal income, state officials primarily hope to do two things. The first is to draw in large corporations from other states with higher tax burdens. And the second is to encourage New Hampshire residents to start their own small businesses.
From the small business perspective, coming out of the Great Recession, the results have been mixed.
In 2008, the federal Small Business Administration found that firm closures outpaced openings. Almost 8,400 small businesses opened in New Hampshire, while 9,053 closed. Those numbers didn’t discourage entrepreneurs from creating new companies. The following year, New Hampshirites incorporated 2,471 companies and created 15,893 Limited Liability Companies (LLC’s).
Those numbers are up by more than 50 percent since 2006–a year before the recession hit.
Across industries, very small businesses with no more than four workers account for nearly 35 percent of the state’s manufacturing companies and about 44 percent of retail stores. The latest estimates number New Hampshire’s small businesses at 32,103.