DURHAM, N.H., JAN. 24 -- The Democrats brought their presidential debate roadshow to New Hampshire today for a spirited exchange on taxes, trade and foreign policy that often made a bystander of front-running Gov. Michael S. Dukakis of neighboring Massachusetts.

The sharpest disputes during the two-hour debate on the University of New Hampshire campus here centered on how to pay for the programs the Democrats support while reducing the federal deficit, which all of the candidates blamed on President Reagan.

Sen. Paul Simon (D-Ill.) and Rep. Richard A. Gephardt (D-Mo.), who are locked in a seesaw battle for the lead in the Iowa caucuses a week before the Feb. 16 New Hampshire primary, clashed over their voting records in 1981 when Congress enacted the huge Reagan tax cuts.

Sen. Albert Gore Jr. (D-Tenn.), one of the most aggressive of the candidates, angered former Arizona governor Bruce Babbitt by describing his call for a national sales tax as "a Republican, regressive idea."

"That's across the line," Babbitt shot back, citing his experience as a civil rights and antipoverty worker. "Nobody questioned my {Democratic} credentials then." "Well, don't put out Republican ideas," Gore retorted.

Meanwhile, as moderator John Chancellor of NBC News urged the seven candidates to shorten their answers, Dukakis came under fire for his stand on taxes and his claims about the "Massachusetts miracle" of economic growth.

Babbitt called Dukakis' suggestion that the budget deficit could be significantly reduced through more aggressive tax collection practices "flimflam." Former Colorado senator Gary Hart, far more animated and aggressive than in his first debate appearance in Iowa 10 days ago, told Dukakis that if he did not recognize the need for higher taxes, "it seriously calls into question your understanding of the situation."

Gore ridiculed the "Massachusetts miracle," saying that New Hampshire has a lower unemployment rate than Massachusetts but that "surely John Sununu shouldn't be president." Sununu, New Hampshire's Republican governor, is Vice President Bush's campaign chairman in the state.

"The miracle missed Roxbury," Jesse L. Jackson added in reference to a poor, largely black section of Boston.

Dukakis' aides seemed unconcerned by his bystander's role, asserting that he discussed the issues he wanted to address. New Hampshire Democratic Chairman J. Joseph Grandmaison noted that Dukakis has held himself above the fray in all the debates and that it would have been a mistake to switch tactics in his political backyard, where he maintains a strong lead in public opinion polls.

Although Gore is near the bottom of those polls, his aggressive style earned him praise from observers.

"I hate to admit it, but Gore did pretty well," said Gephardt pollster Ed Reilly.

The Democrats' debate was less lively than the Republican debate, also moderated by Chancellor, eight days ago, and the candidates showed fewer flashes of personal animosity than they have in recent joint appearances in Iowa.

They may be suffering from debate fatigue. The Democrats also debated Saturday in Ames, Iowa, and are set for yet another debate -- to be televised to much of New Hampshire by WBZ-TV -- in Boston on Monday.

{Babbitt's father, Paul J. Babbitt Sr., died today in Flagstaff, Ariz., at the age of 89, the Associated Press reported. Babbitt campaign aides in New Hampshire said he would cancel appearances in the state and his participation in the Boston debate on Monday, the AP said. Obituary, Page D7.}

Simon, running second to Dukakis in polls here, was also the second least aggressive debate participant. His sharpest exchange came with Gephardt, whom he attacked for voting for the 1981 Reagan tax cuts.

Gephardt said he had supported a Democratic alternative, only voting for the Reagan plan after it failed.

"I voted against all three {tax cut plans} and I'm proud of it," Simon said. "And you were wrong," Gephardt replied.

The first fireworks were lit, unintentionally, by Chancellor's introduction of Hart as a man who "abandoned" the campaign last spring and returned to ask Democrats, "Will you love me in December as you did in May?"

At his earliest opportunity, Hart chided the veteran NBC analyst for "the questionable taste of your introduction."

Later Hart faced a far more direct reference to the Donna Rice episode, which caused him to suspend campaigning for seven months. One of the student questioners asked if his "compromising position" left Hart open to the threat that as president, "blackmail . . . {could} be attempted."

As on previous occasions, Hart said he had "tried to live as good a life as I could . . . not a perfect life." He cited his early opposition to the Vietnam war, the MX missile and the Reagan administration tax cuts as proof of character and brought up his record as the first presidential candidate in 1984 to refuse political action committee contributions.

Hart labeled "absolutely false" a report in the Orange County (Calif.) Register, based on two unnamed sources, that officials in his 1984 campaign had orchestrated possibly illegal contributions from a California entertainment official. Hart challenged the accusers to come forward, saying "I have run an honorable campaign."

Keeping to their pattern of ignoring Hart as far as possible, the other six Democrats made no effort to challenge his account.

Nor did any of them engage Jackson in debate, allowing Chancellor and a student questioner to raise Jackson's lack of governmental experience and his support of various controversial Third World causes and leaders.

While taxes were the main issue of the matinee debate, the candidates also tangled on trade, nuclear weapons and aid to the contras. Gore, Babbitt and Hart took out after Gephardt for his effort to change trade laws to permit U.S. retaliation against nations that develop a big trade surplus through unfair trade practices.

Gephardt said "we need a new approach to change the status quo," and asserted that it was the threat of the Gephardt amendment that led to the recent U.S.-Canadian "free trade" agreement.

Hart said protectionism in any form "is the worst old idea" around, Gore said it was "a disservice to the American people" and Babbitt said it reflected an unjustifiably "pessimistic fear that America can't compete."

On aid to the contras, the forces opposing the Sandinista government in Nicaragua, Gore took criticism from several of his colleagues. He defended his record of supporting non-military aid to the contras at times in the past five years, and left open the possibility he would do that again this year. But Gore said that if the new Reagan administration proposal "contains any military aid at all, I'd vote against it."

Babbitt said it is "time to terminate contra aid -- period," and Hart said Gore's approach contains "too much of the Reagan philosophy."

Provoked, Gore told Hart that if the Coloradan's advocacy of a moratorium on deployment of intermediate-range U.S. missiles had prevailed several years ago, "we wouldn't have the INF Treaty" Reagan signed last month with the Soviet Union. Hart's demurrers -- "Wrong, wrong, wrong" -- were lost as Gephardt went back again at Gore on the contra issue, saying that "if we vote to give them any kind of aid," the administration will convert it into military assistance.