The Roundhouse in Santa Fe in April 2022. (Photo by Austin Fisher / Source NM)
A bill passed Tuesday by the New Mexico Legislature will give New Mexico residents $500 apiece in two payments in the coming months, an effort to soothe the pain of record-high gas prices.
The increase in gas prices globally has been bittersweet for New Mexico. Average gas prices here are $4.14 a gallon, an increase of $1.29 over last year, according to AAA. But the spike in fuel costs has added $300 million to state coffers, according to an estimate by an analyst at the Legislative Finance Committee.
Lawmakers met Tuesday to decide the best way to send some of that money back to New Mexicans feeling pain at the pump. In the end, they decided the state should forgo about $677 million in income tax revenue over the next two fiscal years by returning it to taxpayers as a rebate.
New Mexicans who filed or will file income tax returns in New Mexico for tax year 2021 will receive $500 as individual filers or $1,000 if they file jointly. The first payment will arrive in May or June and the second in September.
New Mexicans who provided their bank account information when they filed their tax returns will receive the payment as a direct deposit. Others would likely get a check in the mail, legislators said.
In addition to the rebates enacted Tuesday, New Mexicans who make less than $75,000 a year individually or $150,000 jointly can expect a separate rebate check in the coming months, thanks to the tax package enacted during the legislative session earlier this year. That rebate will also be $250 for individual filers and $500 for joint filers.
There are about 490,000 single filers in New Mexico and about 432,000 filers who are married, head of household or with dependents, according to an analysis by the Legislative Finance Committee.
Lawmakers on both sides of the aisle seemed to applaud the bill’s effort to return the oil and gas surplus to taxpayers. But Republicans, in committee hearings and on the House floor, devoted most of their objections to a second part of the bill, one that dedicates $20 million in payments to New Mexicans who don’t file tax forms.
The bill, introduced by Rep. Christine Chandler (D-Los Alamos), would provide $1,000 to married couples or single person households with dependents. It would also provide $500 to individuals, so long as they didn’t file a state tax return. The money for non-filers would be provided on a first-come, first-served basis when residents apply for the funding from the state Human Services Department.
Republicans blasted the provision as an unnecessary giveaway or a lost opportunity to encourage residents to file a tax return.
The Legislative Finance Committee estimates there are 135,000 residents who do not file New Mexico income taxes. That includes about 72,000 whose income is so low they don’t owe taxes and 60,000 undocumented residents.
Somos Un Pueblo Unido, an immigrant and worker rights group, showed up in force at House committee hearings throughout the day, offering testimony from workers who said they needed the additional help amid rising costs and after a terrible pandemic.
The bill passed the House 51-13 before rounding the bases with a breeze in the Senate 35-1.
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