Legislation, HB 367, has been introduced in the New Mexico Legislature, that would reduce New Mexico’s GRT rate by an additional 0.25 percent tax (on top of a .25% reduction that is already being implemented) meaning the state’s gross receipts tax rate would drop to 4.625% in July. You can read news reports no the plan here and here.
What’s even more critical is that this proposal would FINALLY address the biggest current problem with New Mexico’s gross receipts tax (pyramiding of taxes especially those on business services).
This is genuinely good news and both Gov. Lujan Grisham AND Rep. Jason Harper (who has been dogged in his determination to address this issue) deserve credit for taking it on.
So far the main opposition comes from revenue-rich local governments like Albuquerque which says it could lose up to $30 million under the proposal. Will the proposed reform have enough momentum to get over the finish line? Would some kind of “hold-harmless” like what was done when Bill Richardson ended the tax on groceries help? We don’t know but we are certainly pleased with this development.
2 Replies to “HB 367 to address GRT pyramiding introduced: and MLG publicly supports!”
The State, now sitting on billions of O&G money, should establish some kind of fund that would help municipalities and counties make the transition to the proposed change.
But the change needs to happen to make NM competitive with neighboring states.