In 2009, New Hampshire’s combined state and local tax burden ranked 44th of the 50 states. This is achieved, in part, by having no state general sales or use tax and no tax on income from wages. Instead, the state and local governments rely heavily on the property tax for revenues. As such, New Hampshire has one of the highest levels of property taxes in the nation. The New Hampshire statewide property tax rate is determined by the amount of revenue that is needed, approximately $363 million (New Hampshire Department of Education, 2011). The 2010 rate was $2.190 per $1,000 equalized valuations (Transparent NH).
EFFICIENCY: The New Hampshire statewide property tax appears to be an efficient tax. Behavior changes seem minimal as a result of the tax. Both homeownership rates and home size are higher in New Hampshire than the national average.
EQUITY: The New Hampshire statewide property tax was instituted because of inequities in education funding. Now, the statewide property tax funds the public school system, a public education system that is better than at least 40 states in the nation. In addition, the state instituted property tax relief for low to moderate-income homeowners. To read more about the history of low and moderate-income homeowners property tax relief click here.  However, the traditional view of property tax is regressive, that is the lower tax brackets pay a higher share of their income than those in higher tax brackets.
ADEQUACY: The adequacy of the statewide property tax to generate revenue is about average. On one hand, the tax base is fairly large which allows the state to collect quite a bit of money. Property taxes are also more stable than sales or income taxes. However, property taxes are one of the most hated taxes and are often subject to property tax limits, constraining revenue generation for local governments. They also have a lower tax elasticity, or ability for tax revenues to keep up with changes in income, than sales or income taxes. Property taxes as revenue producers are increasingly falling short and often do not keep pace with the financial needs of local governments; leading many states to introduce additional taxes such as income or sales taxes.
FEASIBILITY: The use of a property tax to solve the education-funding crisis was relatively simple and highly administratively feasible for New Hampshire, it merely added onto an existing tax without increasing these drawbacks. The political feasibility of the property tax however was a bit more difficult. The New Hampshire Supreme Court required equalization in school funding, however, New Hampshire citizens have historically been resistant to tax increases. While any tax increase would inevitably be unpopular, among the choices, this was the least unpopular.