How New Hampshire Poaches Massachusetts Businesses

A fascinating account in today’s Boston Globe about how New Hampshire poaches Massachusetts businesses:

New Hampshire pays Michael Bergeron to be a full-time thief, sending him across the border in an unmarked black sedan to poach Massachusetts companies.

To help keep his missions undercover, the business recruiter even scraped the New Hampshire state seal off his Ford Fusion. Equal parts real estate agent, financial adviser, and deal fixer, Bergeron has lured dozens of Massachusetts companies to the Granite State over the past few years with promises of lower tax bills, cheaper office and industrial space, and fewer regulations.

John Hancock Financial and Liberty Mutual Group are among the high-profile firms that recently moved significant parts of their operations over the state line – partially because of Bergeron’s pitches. And an increasing number of small and midsize firms are considering migrating as a way to reduce costs in uncertain economic times.

“New Hampshire has become an easier place to do business as Massachusetts has become more difficult,’’ said Bergeron, who works as a business development manager for the New Hampshire Department of Resources and Economic Development. “It’s a lower cost to do business here and you still have the availability of the skilled workforce in Massachusetts.’’

His PowerPoint presentations highlight what New Hampshire officials say is Massachusetts’ bad-business reputation. They cite expensive real estate, drawn-out permitting processes, and higher taxes.

There are no official statistics from Massachusetts or New Hampshire on the number of companies that have moved north. But Bergeron estimates that at least 5,000 new jobs have been created over the past five years as a result of Massachusetts businesses moving to his state.

Massachusetts officials and business leaders deny that a mass exodus is underway, although they acknowledge that New Hampshire’s aggressive recruitment tactics can’t be ignored.

Connecticut Raises Sales Tax . . . Helping New Hampshire’s Economy

Bloomberg is reporting that Connecticut just raised taxes by $2.6 billion.  Why does this matter to New Hampshire?  Part of the tax increase includes raising the sales tax . . .

It boosts the retail-sales levy to 6.35 percent from 6 percent while broadening it to cover previously exempt goods and services. The rate becomes 7 percent on “luxuries” such as $1,000-plus clothing and boats above $100,000.

Since New Hampshire is the closest state to Connecticut without a sales tax, this will surely mean that more folks from the Nutmeg state will be shopping here more often (or spend more when they do)–just as Maine residents do already.

It would also help if New Hampshire’s policymakers dropped the cigarette tax rate since Connecticut’s cigarette tax is at $3 per pack (the second highest in the country).  Also, Connecticut’s sales tax is applied to the price of cigarettes which means their increase in the sales tax rate also increases the total tax burden on cigarettes.

Overall, this is bad news for Connecticut taxpayers but good news for New Hampshire retailers.