Tax overhaul to be on special session agenda - Albuquerque Journal

Tax overhaul to be on special session agenda

Copyright © 2017 Albuquerque Journal

Gov. Susana Martinez made it explicit Thursday: Simplifying New Mexico’s tax system is, in her view, a key to solving the state’s budget crisis and a standoff with the Legislature.

She said Thursday that she will add “comprehensive tax reform” to the agenda of a coming special session.

“Despite the challenges,” Martinez said in a speech, “we have a tremendous opportunity.”

The session will focus on crafting a new budget package aimed at ensuring New Mexico has enough cash to continue paying its bills over the next year – amid a downturn in oil and natural gas prices and the nation’s highest unemployment rate.

Gov. Susana Martinez
Gov. Susana Martinez

Overhauling the tax code, Martinez said, “is both a short-term and a long-term solution.”

She didn’t offer specifics on what changes are necessary to break the budget impasse. But she said the state should eliminate virtually all the tax breaks built into the gross receipts tax code – which, in turn, would create a broader tax base and allow the overall tax rate to be lowered.

The overhaul isn’t designed to raise new revenue, but it could generate extra money to help next year’s budget if some tax breaks are phased out before the overall tax rate is lowered in a future year.

In a written statement, Senate Majority Leader Peter Wirth, D-Santa Fe, said many of the tax ideas backed by the governor were already rejected by Democrats and Republicans in the Senate. But he said he shares the goal of broadening the tax base and lowering the rate.

“Comprehensive tax reform is a good goal supported by legislators on both sides of the aisle,” Wirth said. “But tax reform has to be done right.”

Rep. Jason Harper, R-Rio Rancho, said he has been talking with Democratic leaders about how to craft a package of tax changes that both sides can support. The Martinez administration is offering technical help to ensure the changes do what they’re intended to, he said.

“I’m really confident that with all these minds in the room,” Harper said, “we’ll come up with something even better than” the proposals debated in the last legislative session.

A Harper-sponsored bill cleared the House earlier this year but stalled in the Senate over concerns about whether it provided for too many changes too fast. Both chambers later passed a more modest attempt at overhauling the tax system, which Martinez vetoed.

But Harper said Thursday that he hopes negotiations can produce a “hybrid” tax bill – drawing from the previous proposals rejected by one side or the other – for consideration in a special session.

Harper and Martinez made their remarks Thursday at Sandia Resort and Casino at the annual conference of the New Mexico Tax Research Institute, a nonpartisan group that analyzes tax policy.

The Republican governor and the Legislature – where Democrats hold majorities in both chambers – have been at odds for months on a spending and revenue plan for the fiscal year that begins July 1.

State lawmakers passed a $6.1 billion spending plan and a companion bill that included about $350 million in new revenue generated by tax increases and the closing of loopholes. Both bills had bipartisan support in the Senate and passed along party lines in the House.

Martinez, in turn, vetoed the tax package and used her line-item veto authority in the budget bill to strip out funding for public colleges and the Legislature itself. She describes the absence of higher-education and legislative money as only temporary – a move to ensure lawmakers negotiate a balanced budget without tax increases.

Martinez has not set the date for a special session.

Legislative leaders have challenged her line-item vetoes in the New Mexico Supreme Court, and a hearing is set for May 15. The governor didn’t say whether she plans to call the Legislature into session before then.

She has repeatedly vowed to reject tax increases, but she has left open the possibility of generating new revenue through the closing of tax loopholes – positions that make the tax overhaul a key to helping resolve the budget impasse.

Democrats, in turn, say they already sent the governor a menu of tax options that would have helped raise revenue and put the state on track for a broader tax overhaul, even if she rejected some of the ideas.

Home » Journal North » Journal North Recent News » Tax overhaul to be on special session agenda

Insert Question Legislature form in Legis only stories




Albuquerque Journal and its reporters are committed to telling the stories of our community.

• Do you have a question you want someone to try to answer for you? Do you have a bright spot you want to share?
   We want to hear from you. Please email yourstory@abqjournal.com

taboola desktop

ABQjournal can get you answers in all pages

 

Questions about the Legislature?
Albuquerque Journal can get you answers
Email addresses are used solely for verification and to speed the verification process for repeat questioners.
1
Green comet sighting is 50,000 years in the making
ABQnews Seeker
For the first time in 50,000 ... For the first time in 50,000 years, the public has the opportunity to witness a green comet as it pa ...
2
Musician Matt Hillyer found inspiration for album 'Glorieta' in ...
ABQnews Seeker
The Texas-based musician Matt Hillyer will ... The Texas-based musician Matt Hillyer will end his tour run with Dale Watson on Friday, Jan. 27, at Launchpad.
3
Police looking for suspect in alleged road rage incident ...
ABQnews Seeker
Police are looking for a man ... Police are looking for a man who was allegedly involved in a road rage incident near the University of New Mexico campus Wednesday afternoon.  ...
4
Stansbury votes on crutches after breaking foot
ABQnews Seeker
Congresswoman Melanie Stansbury cast votes on ... Congresswoman Melanie Stansbury cast votes on the House floor Thursday on crutches. The New Mexico Democrat for more than a week has been walking ...
5
Legislative proposal aims to amplify NM arts economy
ABQnews Seeker
New Mexico would establish a new ... New Mexico would establish a new economic development agency — backed by $67 million in state funds — to support artists and creative entrepreneurs ...
6
Metro judges to conduct Valentines Day weddings
ABQnews Seeker
The Bernalillo County Metropolitan Court will ... The Bernalillo County Metropolitan Court will be sharing the love when judges perform Valentine's Day weddings for the public. The long-standing tradition is now ...
7
Holiday treecyling generated 36,000 pounds of mulch
ABQnews Seeker
Albuquerque and Rio Rancho residents recycled ... Albuquerque and Rio Rancho residents recycled 6,970 Christmas trees after the holidays, according to the Public Service Company of New Mexico, which worked with ...
8
'Early Show with Alax': In new show, an alien ...
ABQnews Seeker
The state's Early Childhood Education Department ... The state's Early Childhood Education Department is producing a program designed to inform families with little ones. Here's how to watch.
9
NM lawmakers weigh job candidate secrecy
ABQnews Seeker
Spending transparency, lobbying disclosure measures move ... Spending transparency, lobbying disclosure measures move forward