, Salem, MA


August 2, 2013

Our view: Taxes drive retail trade over the border


But Dalphond wonders about the long-term wisdom of tax-hungry legislators’ strategy.

“They always seem to pick on the same people,” he said. “Truthfully, do you wonder where the end is? What if cigarettes go away? How is anybody going to balance their budget?”

Legislators in Massachusetts made certain that gas tax revenues won’t decline any time soon. The made the increase permanent by tying the tax rate to inflation.

Massachusetts increased its gas tax from 21 to 24 cents a gallon. New Hampshire is holding the line at 18 cents.

That’s enough to make New Hampshire residents who drive in Massachusetts fill up before they leave home. Curt Gracie, a carpenter from Salem, N.H., told Toole it costs him about $12 more to fill up his pickup in Massachusetts because of taxes, so he tries to avoid doing so.

It’s a simple lesson from economics — taxation influences human behavior — but one that Beacon Hill legislators seem incapable of understanding.

“It’s no surprise that Massachusetts residents are voting with their feet against higher taxes on gas and tobacco,” said Greg Moore, state director for Americans for Prosperity-New Hampshire. “States operate in a competitive environment, so smart consumers will shop around for the best deal, and that’s exactly what’s happening.”

The flight of retail business from Essex County to Southern New Hampshire has hurt Massachusetts border communities. But grasping legislators, even those who supposedly represent our communities, do not care. They have their revenue. To them, that’s all that matters.

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