SANTA FE — A proposal to exempt Social Security benefits from New Mexico’s income tax narrowly passed a House committee Tuesday with bipartisan support.
The legislation, sponsored by five Republican representatives, will head next to the House Taxation and Revenue Committee, potentially its last hurdle before reaching the full House.
Republican Reps. Cathrynn Brown of Carlsbad and Rebecca Dow of Truth or Consequences — two of the sponsors — described the bill as a way to make New Mexico a more attractive destination for retirees with disposable income and time to serve the community.
“Retirees make really great neighbors, on the whole,” Brown said.
Opponents of the bill said that some Social Security income is already exempt from taxes and that more-targeted tax breaks could be offered to help low- or middle-income retirees.
The proposal, House Bill 49, would cost New Mexico about $83 million a year in revenue, according to legislative analysts.
The bill advanced through the House Labor, Veterans’ and Military Affairs Committee on a 4-3 vote, picking up support from two Democrats.
At least four proposals introduced this year call for creating a Social Security tax break.