Gov. names advisory panels to study N.M. tax code

Tax policy committees will meet quarterly

Gov. Michelle Lujan Grisham’s office on Friday announced the formation of two committees to study the state tax system and “recommend changes to ensure fairness, efficiency and equity.”

Taxation and Revenue Secretary Stephanie Schardin Clarke will chair a new policy advisory panel made up of legislators and other state officials involved with tax issues. It will study the strengths and weaknesses of New Mexico’s tax system and its competitive advantages and disadvantages as compared to other states. The group also will identify potential statutory and regulatory improvements.

Clarke also will chair a Tax Practitioner Advisory Committee made up of accountants, lawyers and others who will “advise the governor and secretary on administration and enforcement of the tax code, trends in tax auditing and litigation, and potential process improvements in tax administration.”

“Tax policy is an important way we express our values as a state and raise the revenue to meet our goals,” the governor said in a statement. “These committees will study reform measures thoroughly and help us make sure we get it right.”

Then-candidate Lujan Grisham made

a campaign promise to create a bipartisan tax commission to examine how she might overhaul the state tax code. In April, the governor signed a package of bills passed by the state Legislature projected to raise $70 million in new state revenue.

The legislation created new brackets to the state’s personal income tax, increasing the previous tax rate of

4.9 percent to 5.9 percent for single filers and estates that earn more than $210,000 a year. Married filers can earn up to $315,000 in annual income before paying the additional 1 percent in income tax, according to the bill.

A fiscal analysis said the legislation also reduced capital gains to 40 percent from 50 percent, increased the working families tax credit to 17 percent from 15 percent, increased the state cigarette tax and imposed a new tax on vape liquid used in e-cigarettes, among other changes.

“We chipped away at some of the inequities in our tax system in the last legislative session, and now we need to know if that was enough,” Lujan Grisham said. “Is our tax system fair to all New Mexicans? Businesses of every size? Is it stable enough to provide consistent revenue to fund much-needed programs? These committees will help provide those answers.”

The tax policy committees will meet quarterly, according to the Governor’s Office.

Clarke said in a statement that lawyers, certified public accountants and agents involved in audits and other tax issues should work to find a way to “reduce unnecessary taxpayer burden and improve customer service for all New Mexicans.”