Taxes and spending in the 2024 session

For details on the tax omnibus bill we rely on the Legislature’s fiscal impact report. Here is our breakdown of the bill that passed the Senate, has been concurred with by the House, and is on the Gov.’s desk:

In terms of government, the income tax reductions would reduce state revenue by approximately $159,000,000.  That’s a genuine tax cut.

Between the corporate and capital gains tax hikes there $77,000,000 million in tax hikes contained in the bill.

There are also about $140,000,000 worth of targeted tax credits in the bill (this is up dramatically from the $25,000,000 in the House-passed version. Sadly, most of the credits added by the Senate are poor public policy (like $45,000,000 million in EV subsidies, $25,000,000 for the “advanced energy” tax credit, and $20,000,000 for the “solar market development tax credit.”

Overall, the bill reduces taxes by about $82 million annually. That’s a paltry  2 percent of the $3.5 billion surplus returned to New Mexicans.

The final budget bumps spending by 6.8%. That’s $659,000,000 in new spending. That’s more than triple the amount allocated to tax reductions and credits and more than five times the amount dedicated to actual tax reduction (once tax hikes  are factored in).

Based on the “final” budget (pending potential vetoes), here is the spending growth we’ve seen since Gov. Lujan Grisham took office.