A Holiday from Sound Tax Policy

It’s that time of year. The State of New Mexico is granting the masses a GRT break — but only if they purchase the right things.

As the Tax Foundation documented, “16 states will hold a sales tax holiday in 2017,” covering everything from clothing to school supplies, firearms to air conditioners.

New Mexico’s GRT timeout “begins at 12:01 a.m. on August 4, 2017 and concludes on August 6, 2017 at midnight.” Here’s the ludicrously long list of taxable and nontaxable items.

How can anyone be opposed to lower taxes? Well, the Tax Foundation makes a persuasive case that “sales tax holidays are based on poor tax policy and distract policymakers and taxpayers from real, permanent, and economically beneficial tax reform.” Their value as a “stimulus” is chimerical, they may not offer much of a boost to consumers, and how, exactly, is government qualified to decide what goods are deserving of exemptions?

Last year, Errors of Enchantment proposed a “right-left alliance, aimed at permanently killing the useless gimmick that is New Mexico’s annual GRT holiday.” We’re still willing to give it a shot. Any takers?

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One Reply to “A Holiday from Sound Tax Policy”

  1. Thanks for linking revenue document 200.18 that goes on listing what is and is not taxable for 10 pages and adds the warning that the list is not to be considered definitive. My heart goes out to data processors who have to make these entries for businesses with huge inventories.

    If anyone can make a logical argument of why some items on the list are tax free and others are not, I’d love to hear it. One logical explanation is that the NM state legislature is insane.

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