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Report: NM Taxpayers Shouldering Burden Of Corporate Tax Cuts

PHOTO: A new report concludes that working families in New Mexico will bear the burden of making up revenue lost to corporate income tax cuts. Photo courtesy New Mexico Legislature.
PHOTO: A new report concludes that working families in New Mexico will bear the burden of making up revenue lost to corporate income tax cuts. Photo courtesy New Mexico Legislature.
April 15, 2014

SANTA FE, N.M. - A new report from New Mexico Voices for Children warns that taxpayers will shoulder the burden of the state's corporate income tax cuts. Gerry Bradley, senior researcher, Voices for Children, wrote "The Corporate Income Tax: A Declining but Essential Part of New Mexico State Revenues." He said lawmakers cutting the corporate income tax by about 25 percent in recent years has cost the state about $100 million in lost revenue.

"As the corporate income tax has been cut, that meant personal income taxpayers will end up paying more or it will be picked up through the sales tax," Bradley explained.

Bradley said the state lowers corporate taxes in hopes of attracting industry and investment to create new jobs and stimulate revenue. However, he pointed out, New Mexico's job growth remains among the nation's lowest, despite the tax incentives.

Bradley's report concluded that the state should restore the corporate income tax to previous levels, rather than putting the burden on working families.

The lost revenue may mean further cuts to the already underfunded education budget and other vital programs, Bradley warned.

"Programs such as health care, public education and higher education in New Mexico will have to be cut," he said.
"There's no way around it; it's either one or the other."

The state is just now returning to pre-recession revenue and funding levels for education and other programs, he noted.

Troy Wilde, Public News Service - NM