When it comes to summer tourists coming to New Hampshire from Canada, is there a chill in the air because of White House jabs about tariffs and making our northern neighbor the 51st state?
State officials don’t think so. They think the state’s critical summer season can weather the political tension created by President Donald Trump.
“I think in general, whether you’re talking commercial or leisure travel trends, or any of those sorts of things, there are no straight lines,” said Taylor Caswell, commissioner of the state Department of Economic Affairs. “Everything is up and down all the time. We see changes that affect tourism and people coming to New Hampshire, whether it’s the price of gas, whether it’s geopolitical global issues, all that changes from time to time.”
The state’s senior United States senator, Democrat Jeanne Shaheen, however, fresh from a visit to Canada and a roundtable a few days later with tourism stakeholders in the Mount Washington Valley, is a lot less sanguine about how the political climate will affect summer tourism and, potentially, tax revenue.
“Canadian tourism accounts for up to 20% of visitors in some parts of the state, so I am very concerned about the impact U.S. tariffs on Canada are going to have on New Hampshire’s summer travel season,” Shaheen said.
On Route 3 in Stewartstown, NH, a sign informs motorists about the Canadian customs at the nearby border with Canada. Tourism from Canada accounts for 20% of visitors in some parts of the state, according to Sen. Jeanne Shaheen (Photo by Dan Tuohy/NHPR)
A Republican administration in Concord, led by first-term Gov. Kelly Ayotte, will tend to lean more favorably toward a Republican administration in Washington, D.C. But the Democratic senator pulled no punches in decrying the effect tariffs will have on local tourism.
“In New Hampshire, we should be preparing to welcome Canadian visitors for the summer tourism season – but instead, local businesses and retail sectors across the state are worrying about how travel cancellations and higher costs resulting from the president’s reckless tariffs on Canada will impact their bottom line and ability to operate,” Shaheen said.
Trump’s chatter about imposing tariffs on certain countries has created some unease among geopolitical allies and foes alike. His added blather about annexing Canada as the 51st state has only exacerbated the tension and resentment there.
Canadians are reacting by forgoing their vacation visits to the United States, including to New Hampshire, according to local chambers of commerce and tourist agencies that have recorded canceled reservations and fewer bookings.
One of the possible effects is the impact a less than stellar summer tourism season might have on tax revenue generated by the meals and rentals tax (MRT). Behind business income taxes, the MRT is the second largest source of tax revenue for the state.
State officials gathered last week to offer their prediction of the summer 2025 tourism season — 4.6 million visitors, spending $2.6 billion throughout the state’s economy.
That compares with a summer 2024 forecast of 4.8 million people spending the same $2.6 billion and summer 2023 when officials estimated 4.3 million people would spend $2.35 billion.
During the media conference, Caswell described the spending projections as being “critical to state revenues but also to those small businesses.”
MRT revenue totaled $448.5 million in fiscal year 2023, which ran from July 1, 2022 to June 30, 2023. For the 2024 fiscal year that ended June 30, 2024, the MRT revenue was about $10 million more.
The current FY25 completes its cycle at the end of June, and the tax is trending about 3.6 percent ahead of estimate for this fiscal year and 2.7 percent ahead of last fiscal year. All in, the state was expected to get about $666 million from the MRT in the current budget cycle.
Going forward, that revenue plays a big role in the state’s new budget — a two-year revenue and spending plan that starts July 1, 2025 and runs until June 30, 2027.
Gov. Ayotte’s budget hoped for $724.1 million from the MRT, while the House budget has a more tempered projection at $709.8 million. The Senate’s expectations will be known early next month.
About 80 percent of revenue is meals, rather than hotels or rental cars, according to Phil Sletten, research director at the New Hampshire Fiscal Policy Institute. “I suspect the majority of those meals revenues are people from New Hampshire going out to eat in New Hampshire,” he said.
But others are worried that a less than lustrous tourism season could have a big effect on local tourism related revenue and on tax revenue.
Mike Somers, president of the New Hampshire Lodging and Restaurant Association, told Senate budget writers this month there are a variety of factors contributing to current market volatility, including tariffs, but also concerns about inflation.
“Consumers being more cautious in their spending and a likely downturn in international visitors, it will be challenging with any certainty what lies ahead,” Somers said to senators, adding his hope for the season was for his members’ revenue to be flat if not slightly up.
“If the weather is nice and warm and not a ton of rain on the weekends, it will be a great season,” he said.
Shaheen on May 27 hosted a roundtable discussion in North Conway with Mount Washington Valley Chamber of Commerce representatives from tourism-related businesses. Hotels, attractions, eateries and retailers were among the attendees.
They told the senator that inquiries from Canadians — via website and telephone — were down more than 50% from last spring. Another barometer they used was Canada’s Victoria Weekend, May 17-18, a three-day holiday that typically brings visitors here.
A chamber of commerce survey of membership showed Canadian visits were down by 80% from last year that weekend. “Canadians are making very few new reservations, with most canceling existing reservations after the US announced tariffs on Canadian imports and suggested the idea of the US annexing Canada,” the survey noted, adding, “Poor weather also played a factor in low visitation over Victoria Weekend.”
During her visit to Ottawa May 23 as part of a bipartisan delegation from the Capitol, Shaheen said in a CNN interview, “at a time when we’re facing adversaries like China and Russia, when the global situation is so precarious, we need to do everything we can to work together with our allies.”
Noting New Hampshire’s short border with Canada, she said “we have the highest percentage of Canadian Americans of any state in the country. Not only do we have family relationships, we have business relationships, tourism … very much dependent on our Canadian visitors.”
State officials say they continue to market to Canadian visitors, especially from the Montreal area. Marketing efforts are also taking place in the rest of New England, New York, and road-trip accessible eastern Pennsylvania.
“We are confident that New Hampshire continues to be a popular destination, in large part due to the incredible product we offer,” Caswell said. “Our state tourism industry works hard to assure visitors get a world-class welcome and experience when they travel here.”
