By Andrew Oxford, Santa Fe New Mexican
Dec 15, 2018
In many ways, it’s the ultimate paradox.
The state’s coffers are brimming with cash from an oil boom.
By the time the next legislative session is over, New Mexicans may see some of their taxes going up anyway.
Beneath the numbers of New Mexico’s anticipated budget surplus, lawmakers and economists see a tax system out of whack. It is heavily reliant on taxes from sales and services — a rushing stream of revenue that could dry up with the next downturn in the oil markets. Meanwhile, high earners pay about the same rate of state income tax as those just scraping by. And the state boasts some of the lowest property tax rates in the country.
Almost every legislative session spawns a proposal to raise a tax here or there. But with corporate tax cuts and past oil industry slowdowns fresh in the minds of many, lawmakers are heading into the 2019 legislative session looking with a particular urgency to change how the state raises money.
“We’re riding a roller coaster uphill,” said Senate Majority Leader Peter Wirth, D-Santa Fe. “Diversification is absolutely critical.”
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