Lawmakers in New Mexico have approved Senate Bill 151, which would increase taxes on businesses by disconnecting the state from certain federal tax provisions. These provisions currently allow businesses to deduct investments in equipment, facilities, and manufacturing. If signed into law, companies that invest and expand in New Mexico would face higher state taxes.
The New Mexico Taxation and Revenue Department estimates that this change could generate over $100 million annually in new taxes for the state by fiscal year 2028. Small business owners are already experiencing increased costs and ongoing economic challenges.
There is an option for Governor Michelle Lujan Grisham to use her authority to issue a line-item veto on the tax increase since SB 151 contains an appropriation. Business groups are urging the Governor to take this action.
“Small businesses are already facing rising costs and economic uncertainty. Now is not the time to make it more expensive to expand or create jobs.”
