February 29, 2008 Granite State may adopt income & sales tax Play video

(NECN) - The Granite State has long touted itself as a state with no income and sales tax, but that era may soon be coming to an end.

In New Hampshire . . . It's simply called "the pledge"

"Read my lips . . .no new taxes...."

Historically, when someone runs for a state level office in New Hampshire, he or she pledges to oppose or veto any broad based tax.

"Our license plates shouldn't say live free or die, it should say live free of taxes or die."

But is it time for lawmakers to break the pledge?

" My organization feels that it's not working now, today, and we should take a hard look at it."

The Granite State Fair Tax Coalition has put forth an article that will appear on 88 town meeting warrants this spring. It calls on state representatives, senators, and the governor to break the pledge and talk about ways to reduce the state's 800-pound gorilla:

" When your government doesn't consider options to the property tax, the property tax becomes the tax of default, so it's the tax that keeps going up."

As it is, 60 cents of every budget dollar comes from property taxes. Some say it's unfair and unbearable:

"We're about to walk into a very deep recession. And when people are losing their jobs, and their homes are losing value, to have the highest property tax rates in the nation makes no sense."

The coalition doesn't propose a solution. It says

it just wants to start the discussion on how to make New Hampshire's budget structure more equitable. Others are skeptical of that. Leading republicans say there is clearly an agenda behind this town meeting article.

"What this group that is opposed to the pledge really wants is a broad based tax in New Hampshire, higher spending, and I wish that they would just be honest about that as their goal."

But Paul Herle believes the state should only change the way it raises money and not how much it spends:

"New Hampshire will always be a frugal state and New Hampshire will always have small government. But we need to fund that government in a rational way."

NECN's Lauren Collins joins us with more.