Virtually no matter how you slice the data, New Mexico is a high-tax state. Wallethub found our combined “sales” (GRT), income, and property tax burdens 20th-highest as a percent of income. The Federation of Tax Administrators places us 11th-heaviest for 2017.
Adding additional evidence to the case for New Mexico’s high-tax status, Key Policy Data has just released data showing that New Mexico’s state and local tax burden (tax collections divided by private sector personal income) was the sixth highest in the nation for FY 2016 at 17.6 percent—or 24 percent above the national average of 14.3 percent.
With a $672 budget surplus (thanks to oil production and prices) an attempt at revenue-neutral tax reform is an absolute minimum. Even better would be a move to reduce the overall tax burdens faced by New Mexicans.
5 Replies to “New data reinforces New Mexico status as high-tax state”
This would be why businesses don’t bring jobs to NM, not because we aren’t a RTW State, because we have High Taxes, are First In Crime and Last in Education.
And Michelle Lujan Grisham will have to RAISE TAXES to pay for everything she want to Give Away
No, it’s that too.
For those wondering why the rankings differ in these evaluations by Wallethub, the Federation of Tax Administrators and Key Policy Data, the answer is that they are using different sets of taxes as their basis for comparison.
Wallethub looks at both state+local income, property and sales (GRT) taxes (but doesn’t consider corporate or severance taxes). Essentially, they are only looking at taxes that directly impact households.
The Federation of Tax Administrators only look at state level taxes, but not local taxes while Key Policy Data includes all types of state and local taxes. A very large percentage of state and local revenues in New Mexico comes from extractive industries, primarily oil and gas. The big ones here are severance and ad valorem taxes (the first a type of sales tax, while the second is a type of property tax). New Mexico’s combination of severance and ad valorem taxes are among the highest among major oil and gas producing states. See http://okoga.com/wp-content/uploads/2018/01/RegionTrack-OK-Oil-and-Gas-Taxation-1_22_18-FINAL.pdf
Combine this with above average personal taxes (for an oil and gas producing state) and you get to Key Policy Data’s number six ranking.
Thanks for your input. Yes, these reports do measure things differently. I put them all out there because it is abundantly clear that New Mexico taxes are quite high!
No argument from me on that, and thanks for putting all of these different evaluations out there.