Last week the New Mexico House of Representatives voted unanimously to remove the food tax from House Bill 412, the most comprehensive tax reform legislation in a generation.
New Mexico’s gross receipts or sales tax system is a mess. It is undermined by 383 loopholes, exemptions and deductions for a grab bag of things ranging from fuel for space vehicles to professional boxing matches to recreational vehicle sales. Rep. Jason Harper, R-Rio Rancho, has been thoughtfully leading the fight to close these and dozens of other loopholes and to use the resulting revenue to reduce overall tax rates.
But unlike the special-interest loopholes that HB 412 seeks to close, the food-tax exemption benefits hundreds of thousands of low- and middle-income New Mexico families, as explained most recently in these pages by the New Mexico Voices for Children. As a consequence, the food-tax exemption enjoys wide public support.
Simply put, reimposing the tax on food does not belong in a tax-reform package.