I am writing today to announce the closure of the New Mexico Independent. After three and a half years of operation in New Mexico, the board of the American Independent News Network, has decided to shift publication of its news…
Roll back Gov. Bill Richardson’s signature ’03 income tax cuts?
By now, we’re all pretty much aware of the swelling state budget deficits we got going on here in the Land of Enchantment.
Now comes an idea to shore up state finances by, among other things, rolling back the first major legislative accomplishment Gov. Bill Richardson notched after he was elected — slashing the state’s top marginal income tax rate back in 2003.
According to a letter delivered to lawmakers earlier today signed by a group of 14 New Mexico advocacy organizations, one proposal the governor and lawmakers should consider to plug the state’s gaping budget hole is “rolling back some or all of the huge personal income tax cuts for the wealthy.”
That tax cut, which lowered the state’s top income tax rate from approximately 8 percent to just under 5 percent, cut state revenue to the tune of several hundred million dollars each year.
The letter’s signatories include the New Mexico Arts Alliance, Equality New Mexico, the local chapter of ACORN, as well as some of the state’s most politically active unions.
To be fair, that’s one of five proposed alternatives to what the letter calls an effort to safeguard “crucial state expenses” including “social services, health care programs, public education, arts and public employee salaries and benefits.”
And to be doubly fair, the ’03 income tax cuts weren’t just the governor’s doing; a unanimous Legislature supported the tax cut, too. Also, back then, the state’s revenue picture looking much rosier — well, greener actually — unlike today.
A recent state budget story by the Associated Press, provides the (ugly) context:
Since mid-2008, the state’s revenue outlook has become increasingly bleak. When the Legislature met a year ago, the state expected to collect about $6.2 billion in the 2010 fiscal year. In December, the forecast was rolled back to $5.7 million. Now it’s $5.45 million.
The other revenue-boosting ideas include clamping down on TIDD s, mandating combined reporting of corporate income taxes, a temporary tax surcharge, and boosting oil and gas pollution penalties.
The governor and state lawmakers are faced with a budget deficit in the current fiscal year that is estimated at nearly half a billion dollars — and the next fiscal year’s deficit may well be larger.