Gov. Ayotte touts New Hampshire Advantage with tax burden rankings

NH Gov Kelly Ayotte (Courtesy photo)

With Tax Day approaching on April 15, personal-finance company WalletHub has released its 2026 Tax Burden by State report, along with commentary from experts.

New Hampshire Gov. Kelly Ayotte recently hailed the report adding it's just one of many metrics that show the Granite State as leading the pack when it comes to livability.

"I'm proud that New Hampshire once again has one of the lowest tax burdens in the country<" she said. "We're the envy of New England and the nation because we're smart about our spending and focused on keeping more money in Granite Staters' pockets. We're going to keep holding the line against new taxes so we can protect our New Hampshire Advantage."

The report cites New Hampshire's lack of a state income or sales tax as a major factor in the ranking. Last week, New Hampshire was also named the state with the best taxpayer return on investment for the 11th year in a row.

The Granite State continues to lead the nation in a host of key metrics:

• #1 for public safety
• #1 for child wellbeing
• #1 for health care
• #1 for economic opportunity
• #1 for economic freedom
• Lowest poverty rate in the nation

To identify which states place the heaviest tax burden on residents, WalletHub compared all 50 states across three major components of state taxation--property taxes, individual income taxes, and sales and excise taxes--measured as a percentage of total personal income.

For the full report, please visit:
https://wallethub.com/edu/states-with-highest-lowest-tax-burden/20494



"It's easy to be dismayed at tax time when you see just how much of your income you lose. Living in a state with a low tax burden can alleviate some of that stress. Some states charge no income tax or no sales tax, although all states have some form of property taxes and excise taxes."
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"Oregon has the highest individual income tax burden, while Vermont has the highest property tax burden, and Hawaii has the highest sales and excise tax burden. When considering all types of taxes together, Hawaii has the highest overall burden."

- Chip Lupo, WalletHub Analyst


Expert Commentary

What is the relationship between state tax burden and economic growth?

"The link between tax rates and economic expansion is a constant balancing act between attracting investment and maintaining the infrastructure that businesses need to thrive. Recent data indicate that the nine states without a personal income tax have experienced some of the highest net migration and GDP growth rates over the last decade. A 2026 report suggests that phasing out state income taxes could increase total GDP by 1.6 percent by encouraging new startups and attracting high earners. However, the most successful economies are those that strike a middle ground, keeping tax burdens competitive while investing enough in education and transport to build a high-quality workforce. Reliable economic growth is best sustained by a tax structure that is stable enough to fund the long-term assets that drive private sector innovation."
Andrew Burnstine, Ph.D. - Associate Professor, Lynn University


Should states and localities tax property at different marginal rates like they do income?

"Introducing marginal rates to property taxes could provide much-needed relief to middle-class families while ensuring that luxury estates contribute more to the local tax base. Currently, most property taxes are flat, meaning the average U.S. household pays about $ 3,119 per year regardless of whether they own a modest home or a massive mansion. Applying higher rates to properties above a certain value would allow cities to stabilize their budgets during real estate booms without pricing out long-term residents. This progressive approach helps prevent the displacement of seniors and low-income homeowners by shifting the burden to the high end of the market. Modernizing property taxes with marginal tiers ensures that local revenue is collected fairly and reflects the true distribution of housing wealth in the community."
Andrew Burnstine, Ph.D. - Associate Professor, Lynn University


What makes some state and local tax systems better able to weather economic downturns?

"Resilience during a recession is built on a foundation of diversified revenue streams and robust reserve funds that act as a buffer when private spending slows. States with a wide variety of tax sources are better positioned to maintain essential services like public safety and healthcare without having to implement emergency tax hikes. As federal subsidies are being cut or reduced, local authorities and state governments are increasingly relying on rainy-day funds, which have reached record highs of over $ 160 billion nationally. A diversified system that combines stable property taxes with income and sales taxes is the most effective way to protect against market volatility. By preparing for the inevitable feast-and-famine cycles, governments can ensure they remain fiscally sound even in the most challenging economic environments."
Andrew Burnstine, Ph.D. - Associate Professor, Lynn University


How has inflation affected local governments' tax revenues?

"Inflation creates a complex fiscal environment in which tax collections appear to grow while the government's actual purchasing power is simultaneously eroded. While rising prices have led to a temporary surge in sales and income tax receipts, these gains are often wiped out by the skyrocketing costs of labor, fuel, and construction materials. Recent data shows that while some states saw revenue increases of over 10 percent, nearly 40 states have seen their collections fall below Tax Highest long-term trends when adjusted for the current cost of living. This gap is forcing local leaders to find new efficiencies as the cost of maintaining basic infrastructure continues to outpace traditional revenue growth. Managing the impact of inflation requires a proactive strategy that balances the need for public investment with the reality of higher costs for every service provided to the community."
Andrew Burnstine, Ph.D. - Associate Professor, Lynn University