Few New Mexico politicians wish to recognize publicly just how much New Mexico taxpayers must pay in order to bring Hollywood film companies to the State. Few even admit that the subsidies represent spending of our tax dollars.
But, budgets have a way of clarifying the situation. The following is data taken directly from Gov. Lujan Grisham’s FY 2024 proposed budget. We will remain in FY 2023 until July 1 when the ADDITIONAL film subsidies passed in the recent legislative session kick in. While the Legislature’s Fiscal Impact Report claims the recent tax bill will have a “minimal, but negative” impact in FY 2024 (see below) the cost to taxpayers of those increased film subsidies will increase by an ADDITIONAL $61.5 million in FY 2025, $75.9 million in FY 2026, and another $87.3 million by FY 2027.
With New Mexico’s corporate income tax revenue collections (before deducting film subsidies) hovering at $400 million or so annually, the Legislature could easily eliminate the corporate income tax (while making other needed tax reforms). Sadly, before the Gov.’s vetoes corporate income taxes were set to go up. Nonetheless, we get more than $100 million in subsidies for one chosen industry.