The 173-163 vote mostly followed party lines, with Democrats opposing the bill and all but 9 Republicans supporting it.
The bill sought to lower the rate of the business enterprise tax from .75 to .68 percent but require large nonprofits to pay it.
House Ways and Means Chair, Susan Almy (D-Lebanon) said the proposal would put what she called fragile charities at risk and said it would be wrong to keep the bill alive, even if only to study it.
"We can’t leave all of these organizations hanging in terror. Kill this"
Lead sponsor David Hess (R-Hooksett), meanwhile told colleagues he didn’t expect the bill to pass this year, but says the rise of large non-profits that pay big salaries and compete with the private sector means the BET, which taxes payroll, doesn’t capture a ever-growing part of the state economy.
“13 of the largest non-governmental employers in the state of NH are non-profits. They employ over 31,000 people and they don’t not pay one penny in business enterprise tax.”
The bill was aimed at hospitals, private colleges, prep schools and other non-profits that collect $2m per year in revenue from programs or services.