At the Rio Grande Foundation, we don’t li saying “I told you so” to New Mexico’s political leaders. Really.
After all, if we are saying “I told you so” it’s because politicians have thrown caution and common sense to the wind and embraced some policy or another that has subsequently failed and for which we the taxpayers are left holding the bag.
In the recent past we have warned against boondoggles like the Rail Runner, Spaceport, and ART all of which are widely-recognized as costly boondoggles. We’ve also reliably advocated that New Mexico policymakers wean the State away from reliance on the federal government. We’re proud of our record of predicting these outcomes, but we’d rather have smarter policymakers who do not succumb to the siren song of big-government.
Another policy that the Albuquerque Journal has recently revisited and come to a negative conclusion on (at least pointing out that it amounted to a massive tax hike) is the elimination of the grocery tax and subsequent elimination of “hold harmless.” As noted in this Journal editorial, Bernalillo County taxpayers “got a tax break of $16.5 million in 2017 that only cost them $51.411 million.” In other words, the grocery tax repeal and subsequent tax shifts resulted in a net annual tax hike of $43.347 million. Results may vary depending on the specific situation in other cities and counties across the State, but generally the situation resulted in higher taxes.
We at the Rio Grande Foundation opposed the grocery tax “swap” way back in 2003. We also weren’t particularly ecstatic about the last-minute legislation that slightly reduced corporate taxes and allowed local governments to raise their GRT.