Republican gubernatorial candidate Mark Ronchetti has proposed a tax plan that includes tax cuts that his main opponent in the general election says are unachievable.
The proposed tax plan includes permanent tax cuts for middle- and low-income workers, rebates on state oil and gas revenues, economic incentives for companies wishing to move to New Mexico and create jobs and a small business bailout.
The proposed plan says all New Mexicans would receive $100 for every billion dollars in oil and gas revenue New Mexico receives.
“Right now, the state of New Mexico has one of the worst tax structures in the country for small businesses and people from all political backgrounds agree that it needs to change,” the spokesperson said. Ronchetti campaign, Ryan Sabel, in response to a survey by NM Policy Report. “New Mexico’s state government has never been so wealthy and [Gov.] Michelle Lujan Grisham has grown the government 40% as our people struggle to surrender at the end of the month. We have more than enough state revenue to give taxpayers back some of their hard-earned money while funding needed government programs. Reforming our tax structure will provide lasting economic relief to New Mexico families and businesses for years to come, creating the long-term economic growth our state sorely needs.
Ronchetti is challenging incumbent Lujan Grisham, a Democrat. Libertarian candidate Karen Bedonie is also running for governor.
The Ronchetti Plan cuts and rebates could cost the state about $2 billion each year, according to a former cabinet secretary in the New Mexico Department of Finance and Administration.
“Over four years, the plan costs $8.2 billion,” New Mexico Voices for Children Action Fund executive director James Jimenez said in a statement. “To put that into context, these cuts and rebates would be roughly equal to the current state budget, which is $8.4 billion. So unless some magic happens in these four years, the state budget should be cut irresponsibly. The specific programs the legislature should cut are not a “black hole” as Ronchetti suggests. Rather, they are the very programs that people depend on, such as public education, higher education, health care, public safety and environmental protection. These plans reflect little knowledge of how the state’s most essential services – education, public safety and health care – are funded. It doesn’t take a budget expert to know that this plan can’t and won’t work.
Jimenez was Governor Bill Richardson’s chief of staff. While on the Legislative State Finance Committee, he served as an economist and supervisor of the performance audit unit.
New Mexico’s current state budget has $8.4 billion in its general recurrent fund which includes public education, higher education, health and human services, public safety, commerce, and government. industry, agriculture, energy and natural resources, justice, general control and the legislature.
General oversight includes funding for public entities such as the National Ethics Commission, Border Authority, Economic Development, Public Regulatory Commission, and National Department of Tourism.
“The Governor has been in state government, she has been a public servant in New Mexico for over a decade, and she has proven over the past four years how to have an effective budget that increases funding for the things that New Mexicans find the most important: education, health care, public safety,” said Lujan Grisham’s re-election campaign spokeswoman Delaney Corcoran. “She was also able to offer relief taxes and reforms to help vulnerable New Mexicans.”
One of the tax relief efforts signed into law in 2022 by Lujan Grisham was House Bill 163 which amended things such as removing the Social Security tax, reducing the gross receipts tax rate of state and the addition of a child tax credit.