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…
House prepared to vote on tax package, Speaker says
A half-cent hike in the state gross receipts tax and a 1-percent surtax on the state’s wealthiest residents are included in the mixture of tax increases and targeted closures of tax deductions and loopholes, House Speaker Ben Lujan, D-Santa Fe, said Thursday afternoon.
The surtax would kick in at $200,000 for married couples, Lujan said. He added the hike in state gross receipts tax would phase out over four years.
Also in the package is a measure called an “add-back” that would close a state income tax deduction for payment of federal income taxes available to New Mexico residents who itemize returns.
Another measure would require companies to withhold taxes on out-of-state individuals who earn income in New Mexico, but don’t currently pay taxes on those earnings. Companies collecting those taxes would have relationships with those individuals, Lujan said.
Lujan said he thinks he has the votes to push through the tax package.
House Democrats will have to produce the votes because GOP lawmakers are united against raising any taxes, said House Minority Leader Tom Taylor, R-Farmington.
“What is disappointing to me is that we just have group after group, department after department, saying ‘Don’t cut us, don’t cut us, increase taxes, increase taxes,’” Taylor said. “There is virtually no creative thinking at this point except how in the hell can we tax people in New Mexico so we can just keep on doing what we are doing.”
The House also will vote on a House-crafted state budget, but only if the tax package passes, several lawmakers said.
The tax package and proposed state budget are the outcome of vigorous internal debates within the House Democratic caucus.
House Democrats have met for days in closed caucus meetings largely to discuss sharp disagreements among members about the revenue-raising proposals. The fact that the 1 percent GRT increase the speaker originally proposed has been cut in half is a sign of the attempts to strike a deal, officials said.
Rep. Mimi Stewart, D-Albuquerque, confirmed Thursday that House Democrats were split on the tax measures three ways – between conservatives, progressives and those in the middle.
“I think our caucus has worked very hard to come to consensus,” she added.
The tax measures would help the state avoid cuts to public education and health care for the poor, she said.
“I think it raises enough revenue so that we can pass a balanced budget package,” she said. “The budget is completely dependent on the tax package.”
Even if the House passes the tax measures and state budget, the Senate likely won’t receive them in a welcoming embrace.
Sen. John Arthur Smith, D-Deming, has said the Senate wouldn’t look fondly on a state budget that relies mostly on tax increases. The proposed state budget in the House would cut $71 million from programs, Stewart said.