Education
6:48 pm
Wed February 20, 2013

N.H. House Votes To Repeal School Choice Tax Credit

Credit Thomas Favre-Bulle / Flickr Creative Commons

The New Hampshire House of Representatives has voted, 188 to 151, to repeal the Education Tax Credit that took effect less than two months ago. The law grants an 85% tax credit to businesses that donate to scholarship organizations, which give the money to students going to a private school, an out-of-district public school, or home school.

Much of the debate on the House floor centered on whether the program is equivalent to a voucher, a question that will likely be decided by the courts. Opponents of the repeal, like Republican David Hess drew the rhetorical battle lines early. Hess was emphatic before the assembled representatives, "The current Education tax Credit is not a voucher. It is not, I repeat, not a voucher," he said. Opponents fo the repeal say the program offers educational choice to low- and middle-income families, and say the law should be given a chance to work before it is judged.

The tax credit is worth $3.4 million dollars in the first year, but grows each year that it is fully utilized. The money, which would have been paid in taxes, instead goes to scholarships averaging $2,500 dollars a student. And yes, the scholarships might be used in religious schools.

Those who favor repeal, like Concord Democrat Mary Stuart Gile, equate it to a voucher program, and say it is unconstitutional. "Business Profit Tax or Business Enterprise Tax revenue is diverted to an intermediary scholarship organization, and could be used as tuition to religious schools." says Gile, adding that it is likely that more scholarships will go to religious schools than not, because "it is very clear that those schools which are religious in nature have lower tuition."

The repeal still has to go through the Republican controlled senate, where leadership has indicated it would not favor repeal.  The question of whether or not the money from tax credits is equivalent to government funds will be decided by a lawsuit now before the Strafford county superior court. A decision is expected in April.