By Paige Knight
June 3, 2024
As a tax policy analyst and a parent choosing to raise my family in New Mexico, I read Hunter Thomas’s recent op-ed “NM at risk of population loss if we don’t lower our tax burden,” Albuquerque Journal, May 19, 2024), with great curiosity. While he provides an interesting perspective, he misses several key points regarding taxes and what factors influence where people call home.
First, New Mexico has already been lowering tax rates for the vast majority of its residents over the past several years. Increased and improved tax credits have returned hundreds of millions of dollars to families over the past few years alone. The state has also lowered the gross receipts tax rate, which benefits us all, including small businesses. And just this past session, lawmakers lowered personal income tax rates for everyone.
Second, and perhaps most importantly, research shows that state taxes have very little impact on where people choose to live. When people do move, it’s primarily due to a new job opportunity or for family reasons. More affordable housing and a better climate also attract people.
A new job – with the added benefit of a much better climate – is what led my family to the Land of Enchantment over seven years ago. Like Thomas, we value the “blue skies, sunny days, friendly people, and affordable cost of living.” We also value the food, culture, diversity, and, in particular, how New Mexicans care deeply for one another and work to improve our collective well-being.
We see that care not only in our neighborhood and community, but also in the Roundhouse, where lawmakers have passed many family-focused policy improvements that have advanced equity and economic well-being for families, especially those most in need.
The tax cuts I mentioned earlier have been specifically targeted to benefit low- and middle-income New Mexicans. This approach helps families across the state afford basic necessities and creates greater opportunities for their children. Additionally, tax credits have been proven to reduce poverty and improve maternal and child health, as well as educational outcomes.
New Mexico has also demonstrated its care for families by increasing investments in programs and services that help New Mexicans thrive. We now have near universal child care assistance that allows more parents – especially mothers – to enter the workforce. We have free higher education that allows students to learn new skills and trades without having to go into debt. We’re making improvements to our K-12 education system, investing in workforce training, making our roads and bridges safer, and improving our public health network. We’ve done all of this with the tax revenue that we bring in each year.
If New Mexico were to make deep tax cuts or do away with its personal income tax, as Thomas seems to suggest, that would leave us with some tough choices. We’d need to either raise taxes elsewhere (such as on property or on sales) or we would have to cut funding for important things like education, health care, infrastructure, first responders, and all the other services that improve our quality of life and make our modern economy possible. Deterioration of these critical services would render New Mexico a less – not more – desirable place to live and raise a family.
New Mexico must continue moving forward on a path to prosperity, one focused on caring for and lifting up our children and families most in need through targeted tax policy changes and sustained investments that create the opportunities needed to thrive and reach our full potential. That’s the kind of action that will both retain – and attract – families to the Land of Enchantment.
Paige Knight, MPP, is a Deputy Policy Director at NM Voices for Children.