taxesThe first two tax increases to reach the floor of the House made it through on Friday, but not before some strong words on both sides. One would temporarily raise the gross receipts tax by one half percent; the other would raise taxes by 1.5 percent on the state’s highest earners. Both bills expect to bring in $300 million to state coffers.

“We don’t take pride or joy in raising taxes” said Speaker of the House Ben Lujan,D-Santa Fe,  who sponsored one of the bills.  House bill 119 would add .5 percent on top of the Gross Receipts Tax (GRT) across the state. That’s an extra 50 cents on every $100 spent.  Currently the state imposes a 5 percent GRT, but sends back part of that to counties and communities. The percentage would decrease with each passing fiscal year, and eventually disappear in fiscal year 2014.

The second measure, House bill 9 imposes a 1.5 percent tax increase on some New Mexicans with six figure incomes. The bill is sponsored by Rep. Edward Sandoval, D-Albuquerque and would bring in $66 million to the state.

“If we pass every pass tax proposal before this house it will bring in less than $400 million, ” argued House Majority Whip, W. Ken Martinez, D-Grants, “We have twice as many cuts as revenue enhancements.” Supporters argued against further cuts in the state budget saying they would lead to layoffs.  “Have you received from our friends in the opposition to this a bill a list of schools where class sizes should be increased if we don’t pass this bill?” Asked Rep. Brian Egolf, D-Santa Fe, “Have you received a list state employees who should be fired?”

“We’re going to come up with the revenue to match what we want instead of living within our means like we expect people to do in their households,” argued Rep. Keith Gardner, R-Roswell who called the bill one of the biggest tax increases in recent state history. Republicans argued the size of state government is too big and that its time to prioritize what is important and look at cutting the rest. “In this state, there are luxuries we can cut,” said Rep. Nora Espinoza, R-Roswell who argued the 800+ page domestic partnership bill cost $28,000 just to print.

“You take all these little numbers, take the exempt positions, it comes up to a lot of money.”

At one point Rep. James White, R-Albuquerque, requested a ‘call of the house’ requiring all those in the chamber to stay there until a vote is cast. After a some tense moments HB 119 survived the House by a vote of 34 to 32. House bill 9 also passed the House, this time by a vote of 36 to 32.

Both measure now head to the Senate where key members have said they will have a difficult time.