SANTA FE — The state House passed a bill Friday that would expand a tax credit for low- and moderate-income workers, increasing the amount of the credit and broadening who would be eligible.
To make up the lost revenue, the proposal would reduce a tax break on capital gains.
Legislative analysts estimated the net effect of the dueling changes would be roughly $6 million in new state revenue, but they cautioned that estimate was uncertain.
Democratic Rep. Javier Martinez of Albuquerque said the changes would allow New Mexico to help more working families and lift people out of poverty.
“It’s a proven poverty-alleviation tool,” he said.
Republican legislators assailed the proposal to increase taxes on capital gains, which they said would discourage investment and dampen economic growth.
“The state would be more prosperous if we had more folks starting and growing businesses,” Rep. Larry Scott, R-Hobbs, said.
The proposal — House Bill 148, sponsored by Martinez — passed 45-23 and now heads to the Senate.
The bill is a priority of groups that advocate for worker and immigrant rights.