Concord, NH – Today, Governor Chris Sununu vetoed SB-1, which would have established an income tax on New Hampshire families.

“Senate Bill 1 is an income tax that neither I nor the people of New Hampshire will ever support,” said Governor Chris Sununu. “I have proposed a paid family medical leave plan that will work – one that is voluntary, affordable and income tax free. That is the New Hampshire way.”

“I applaud Governor Sununu for standing up for New Hampshire taxpayers and vetoing legislation that would have created an income tax,” said Senate Republican Leader Chuck Morse (R-Salem). “An income tax in New Hampshire will be the end of the New Hampshire advantage and the beginning of reckless taxation policies. It is unacceptable for the government to get in between a business and their employee by mandating which benefits they offer, and I am proud to support Governor Sununu for vetoing this bill.”

“Whether you support the concept of paid family leave or not, SB1 is a poorly constructed bill that sets us up for failure. It is a likely-to-be-insolvent, state-run insurance program funded by a mandated 0.5% tax on wages, costing workers and businesses $168 million per year,” said House Republican Leader Dick Hinch (R-Merrimack). “It will cost more than $15m to develop and require over 40 new government employees to administer. 99% of House Republicans voted against this legislation in March, and I will be working hard to guarantee 100% of House Republicans vote to sustain the governor’s veto of this flawed plan. We will have the Governor’s back.”

“While I support the Governor’s voluntary paid family and medical leave plan, the proposed mandatory plan the Governor vetoed had a litany of other problems, possibly the most problematic being the creation of an income tax in New Hampshire,” said Senator Jeb Bradley (R-Wolfeboro). “The fact that an unelected state employee is given the unprecedented power to increase taxes on income makes the bill even worse. I hope that my democratic colleagues will now finally come to the table to negotiate a truly bipartisan voluntary paid family and medical leave plan without an income tax.”

“We thank Governor Sununu for his veto of Senate Bill 1. Among its many issues, the legislation would have levied a new payroll tax on employers in the state. Companies (or potentially individual employees) would have been forced to pay for this benefit, even if they never asked for it or used it. It would be especially burdensome for small businesses. New Hampshire employers know what benefit packages are best for their employees. It’s not the role of government to mandate employers adopt an expensive one-size-fits-all program,” said BIA President Jim Roche.

“NFIB-NH applauds Gov. Sununu for vetoing the bill because it would have been such a burden on small businesses,” said Bruce Berke, state director of NFIB in New Hampshire. “This family leave bill was an all-encompassing mandate, taxing peoples’ incomes even if they would never use this new state benefit. This FMLI proposal put the state at financial risk, cost the employees a benefit they may never use, and impacted employers both financially and administratively.”A copy of the veto message can be found here and a copy of Senate Bill 1 can be found here.