A History of Taxation in New Hampshire

• The earliest reference to taxation in New Hampshire was an oath sworn by the people at Exeter on July 4, 1639, to submit to taxes that were imposed by majority vote.
  
• Early taxes were assessed on items that were used to produce income: farmland, livestock, ships, warehouses, dwelling houses, tools and the like. The only items exempt from taxation were "such property as produced no income." Taxes were also imposed on "all male persons" age 16 or older, with a higher rate assessed on higher-skilled craftsmen such as butchers and bakers because of their ability to earn more money.
  
• The Commission of 1680, which established the provincial government of New Hampshire, specifically recognized the right of the people, through their legal representatives, to impose public taxes. The first general Assembly met in March 1681 - and immediately exercised the power of taxation "without question from any source."
  
• In 1682, representatives proposed several revenue bills which the new governor rejected. The governor dissolved the house and the "attempt was made to secure revenue for the support of government by means of excessive fees, fines and rents." During the next legislative session, the governor proposed a revenue bill - but the house refused to pass it. The stalemate ended with the governor vacating his office, but was immediately repeated under his successor.
  
• In the 1700s, revenues frequently fell short of expenses and the government borrowed money to meet its obligations.
  
• The tax law of 1770 "represented the crystallized experience of neatly one hundred years' endeavor to lay taxes in proportion to each person's income." This act "continued as the basis of the New Hampshire tax system" until 1833.
  
• Funding for New Hampshire's public schools has always been precarious. The State's first school-funding law was passed in 1789, after the Legislature declared that "the laws respecting school have been found not to answer the important end for which they were made." Schools were first funded by poll taxes and taxes on personal property; then by real estate taxes; then by taxes on banking corporations, and on dogs.
  
• Beginning in the early 1800s, New Hampshire moved away from taxes based on ability to produce income, and toward taxes based on ownership of property. Again tax revenues were not sufficient to pay for the costs of government, and in 1842 the state began taxing corporations. In 1864, the state began taxing deposits in savings banks. In 1869, the state raised the savings bank tax and began taxing insurance company revenues. In 1877, the state began taxing the revenues of utility companies, and began charging application fees for corporate charters. In 1878, the state began charging fees for business license applications by hawkers, peddlers, itinerant merchants and dentists. In 1879 the state started charging fees for the inspections needed to obtain business licenses. In 1887, the state increased business license fees. In 1889, the state increased the taxes on insurance companies.

You can read the full report -- as published in 1902 -- here.