New Mexico's Budget And Tax System Need An Overhaul
Commentary: On June 28, Grover Norquist and Paul Gessing had a commentary in the Las Cruces Sun News strongly recommending that the New Mexico legislature not raise taxes in their special session to cover the reduction in tax revenue due to the Coronavirus and falling oil prices.
On June 30 Governor Grisham signed a budget bill that vetoed $30 million in budget cuts for public school support, but reduced 2021 fiscal year appropriations by about $415 million dollars. Proposed salary increases for teachers were reduced from 4% to 1%. Taxes were not raised.
What is wrong with this picture? For over 50 years, conservative policy proposals have been reducing taxes and regulations, destroying unions, and building wealth for billionaires on the backs of average workers.
Businesses do a good job of producing and selling everyday goods and services—but do not provide resources for a good education for all students; physical and mental health access; infrastructure like roads, bridges and broadband internet for rural and poor families; and support for people that need a helping hand.
We used to do this back in the 50’s, 60’s and 70’s—but no longer. Top-down tax and other policies have created economic inequality in the U.S. that does not exist in other developed countries around the world in Europe, Canada, Australia, New Zealand and Japan. Pulling yourself up by the bootstraps doesn’t work if you have no straps (wealth, education or contacts).
New Mexico is one of the largest tax havens in the U.S., offering numerous economic incentives and tax breaks for personal and corporate income. Some examples: a person with a million-dollar income pays the same tax rate as the working poor (all income over $16,000 is taxed at 4.9%); there is no inheritance tax, estate tax or franchise tax; and businesses are constantly receiving tax incentives to come to the state (film industry, Spaceport America, etc.).
What happened to the progressive tax system based on the ability to pay?