Legislative Update
14 January 2004
Number 04-01



Much has been made of Richardson the "Tax Cutter." Bill O'Reilly, Sean Hannity, and even some vaguely confused New Mexico Republicans have been touting Richardson as a tax cutting governor. Here are the actual figures from 2003:

First Session, March 2003:

New Tax Increases: $179 Million
(counting $34 million from raid of the permanent fund, Constitutional Amendment #2)


Cigarette tax (@70cents/pack)
Increase Premiums on Medicaid
1 cent gasoline tax
redefine "residency"
audit/compliance, enforcement
Amendment 2 (FYO4 portion only)
Raid Tobacco Permanent Fund

$43 Million
$32 Million
$8 Million
$4 Million
$21 million
$34 million
$37 million

NEW taxes for FY04 = $179 million After the first session.

Tax relief in same session:

Income Tax, 1st year
Cap Gains, 1st year
Reduce Unemployment tax
Reduction Oil&Gas taxes
Miscellaneous Reductions

Tax reductions totalled =

$17 million
$4 million
$23 million
$1.2 million
$3.9 million

$49.1 million

Net INCREASE in taxes for FY04 = $130 million

After the first session

It is true that tax relief from income tax reduction may in fact reach $360 million for 2008 if it stays in place until then. Remember however, that no Legislature can bind another Legislature, so it may be repealed at any time.

The "Special Session" in November 2003, highlights:

Vehicle Registration fee increase
Weight/distance fees increase
Special fuel tax (diesel)increase
Oversize/Overweight veh.permit increase
Weight/Distance Permit cards increase

New Tax Increases Totalled:

$ 22.2 M
$ 21.2 M
$ 13.9 M
$   3.0 M
$   2.5 M

$ 62.8 M

No tax cuts during the Special Session

In first two sessions, Bill Richardson imposed a total of $241.8 Million in either new taxes, or "forced revenue enhancements" from the treasury that must be made up in some kind of tax or "revenue replacement."

He did achieve minimal tax relief of $49.1 million.

The total new taxes however for a full new fiscal year will actually be $285 million (when the full $78 million taken by Constitutional Amendment 2 Raid on the Permanent Fund is incorporated in the first full fiscal year after its adoption).