I have publicly supported Governor Richardson’s plan to use this special session to give tax rebates to New Mexicans. Under the Governor’s original plan:
New Mexico families would receive an income tax rebate from the state of between $150 and $75. Those with family incomes below $60,000 and no children would receive $150 while families making more than $70,000 would receive $75. Having children would result in additional refunds, with lower-income taxpayers receiving more than higher earners.
As I pointed out, this was less-than-optimal because it actively penalized those who make more money, but since everyone got a rebate it was still a good plan.
Unfortunately, under the Governor’s revised plan which was outlined in today’s Albuquerque Journal(subscription required), the Governor, in response to revised oil and gas revenue numbers, has decided that no taxpayers with family incomes above $80,000 are deserving of a rebate.
There’s nothing at all wrong with giving rebates to all taxpayers — in fact we encourage it — but the idea that families who make more than $80,000 (upper-middle class, but by no means wealthy) and pay higher taxes, is absurd. In fact, this transforms an otherwise viable rebate plan into nothing more than another welfare program.
Unless the rebate plan is revised in order to include all taxpayers, we’d be better off if legislators simply went home right away and the special session was aborted before it got off the ground.