As the 2015 legislative session marches on, economic issues are playing a major role. The contrast between conservative and progressive principles regarding economic development can be seen in numerous bills.
Progressives have introduced legislation to raise the minimum wage, increase job training programs, increase teacher salaries, increase tax credits for working families, cap predatory loan interest rates, and create more tax fairness throughout the state (among many others). (By the way, every one of those bills has met fierce resistance from conservatives in the legislature.)
Conservatives have focused (predictably) on bills that reflect their you’re-on-your-own economic ideology, leaving working families out to dry in favor of bolstering the profits of special interests and big out-of-state corporations. Reducing unemployment insurance benefits, resisting minimum wage increases, making it harder for disabled workers to receive compensation, anti-worker “right-to-work” bills, and reducing corporate income tax rates have all been conservative hallmarks during this session.
A bright spot for progressive legislation in the Senate happened recently when Sen. Mimi Stewart’s bill to phase in a higher supplemental income tax passed through the Senate Corporations committee. It’s next stop is Senate Finance.
Sen. Stewart’s SB 623 would work like this (from the bill’s Fiscal Impact Report):
Senate Bill 623 creates a new section of the Income Tax Act to create the “individual income tax supplemental tax.” The tax is phased-in beginning in tax year 2016 for the following taxpayer categories:
- For married individuals filing separate returns for taxable income in excess of $100,000;
- For heads of households, surviving spouses, and married individuals filing joint returns for taxable income in excess of $150,000;
- For single individuals and for estates and trusts filing a return for taxable income in excess of $100,000.
The new supplemental rate would be phased in — 0.3% in 2016, 0.5% in 2017, 0.8% in 2018, and 1.0% in 2019 onward.
By 2019, New Mexico could be receiving $50 million per year in additional General Fund revenue. As oil prices decline and localities throughout the state are feeling the financial pinch of the Hold Harmless Act revocation in 2013 (to pay for a corporate tax cut), a little bit of new revenue could go a long way.
And, as an update on the conservative resistance to capping predatory lending rates, here’s another bit of economic policy news from the session highlighting where conservative priorities stand (from the House Democrats):
House Republicans vote against the Economic Security Amendment
Republicans vote against a proposal to ensure that 200-2000% interest rate lending scams end in New Mexico
SANTA FE, NM – Today, during the House floor debate on House Bill 356, Representative Deborah Armstrong introduced the Economic Security amendment that would have capped high risk small loans at 36%. Every Republican present voted against the proposal. Rep. Maestas Barnes, Rep. McMillan, Rep. Pacheco, and Rep. Zimmerman were all immediately excused once the Economic Security amendment was introduced.
“We owe it to New Mexico to stop dangerous interest rates that can push a family into financial ruin,” said Representative Deborah Armstrong. “What these storefront lenders do to New Mexicans is unconscionable. This money is going to out-of-state-corporations instead of hard working New Mexicans. The U.S. Military and 18 other states in our nation have passed APR caps of 36% or less. House Republicans failed to act on the will of 85% of New Mexicans who favor a 36% cap and expect this chamber to not play politics but govern our state. House Republicans should not be playing politics with the economic security of New Mexican families.”
Every House Republican present voted against the amendment.