ABOUT PROSPERITY       |      ABOUT THE ISSUES       |           WHO'S INVOLVED     |     CONTACT US

During these tough economic times, do you want someone requiring you to pay part of your hard-earned wages or small business revenues to make sure state employees don’t get laid off and state government programs don’t get cut back?

If “no” is your immediate and understandable response, you have reason to be concerned about the New Mexico State Legislature, which is now meeting in Santa Fe for a 30-day session.

As many news stories have reported, state government -- whose spending has increased astronomically during the past several years -- now faces a severe shortfall as the economy continues to fade, or at least operate in a prolonged “twilight zone.” The 70 House members and 42 state senators are faced with a shortfall of as much as $1 billion total -- $500 million in the current year, and $500 million for next fiscal year.

Both the Richardson Administration and many key finance-oriented legislators (committee chairs) say “some” spending cuts are necessary but their primary thrust is to “raise more money” -- that is to say, YOUR money in the form of taxes.

Few households and even few businesses have the option of just bringing in more money when facing a shortfall -- you have to cut spending. But governments, with the power of taxation, can with relative ease require YOU to pay more to help THEIR shortfall.

This often well-meaning approach takes a narrow look at wanting to “protect” state employees and favorite state programs from being cut. But it ignores the fact that, to do that, the money has to be extracted in the form of taxes from ALL taxpayers. This means you – as employee or business owner.

If you do not feel you can afford to cough up more to help state government deal with its spending addiction of recent years, then now is the time to express your opinions to your state legislators. The solution might logically be to cut spending – not turn to you, the taxpayer, for more of your dollars. To express the view of “cut spending – do not raise taxes,” click here:

'We will strongly oppose any approach to balancing the state's budget that relies on creating new taxes rather than making significant cuts to the growth in state government,' Terri Cole, president, Greater Albuquerque Chamber of Commerce

Raising GRT Bad Idea Now
Albuquerque Journal – op-ed page

Sunday, January 31, 2010 
By Richard L. Anklam
President and Executive Director, New Mexico Tax Research Institute

It is not talked about much, but in the last few years we have increased GRT rates tremendously within New Mexico.

Albuquerque's GRT rate, now at 6.625 percent, has increased by 14 percent since 2003 (18 percent higher before its transportation infrastructure tax expired at the end of 2009), and Santa Fe's tax rate now at 8.0625 percent is up a whopping 28 percent from 2003.

Raising the GRT rate is a profoundly bad idea.

To put it bluntly, if you want to hurt job creation — particularly in small businesses — and increase the tax burden on the poor at the same time, then this is how you do it.

You may have heard the phrase 'broad base, low rate.' It is something to aspire to, and something the GRT was for many years.

Narrowing of the base of the tax has and will lead to pressure to raise rates. And raising the rate will inevitably lead to greater efforts by special interests to carve out activities from the tax. Ultimately this leads to a less stable, less fair tax.

Let's hope we don't make a real problem worse when there are much less damaging alternatives.