Martinez to Local Businesses: Out of State Corps Matter More

The governor sent a powerful message about her priorities this week

when she vetoed Senate Bill 9: Corporations matter more to state

government than locally owned businesses.

“She said it have raised taxes for those businesses (operating in

multiple states),” said Steven Mayes of , “but the only way

it would have raised them is if they weren’t paying their taxes in the

first place.”

SB9, sponsored by Sen. Peter Wirth, would have required large

retailers like Best Buy and Walmart, which operate in other states as

well as New Mexico, to file the same tax returns as local businesses.

It sought to close a loophole in the state’s tax code allowing those

companies (with stores over 30,000 square feet) to send profit earned

here to another state without a corporate income tax, like Delaware,

and declare the money there.

Wirth first introduced the bill eight years ago and has long argued it

helps local businesses by making their more powerful competitors pay

the same taxes they do.

Martinez had long said she would veto the bill if it cleared both

houses at the legislative session, but a coalition including MoveOn,

the CWA and other labor groups had rallied thousands of supporters to

contact the governor’s office and ask her to sign the bill rather than

vetoing it.

The bill would have lowered the corporate tax rate in New Mexico from

7.6 to 7.5 percent, so not only did it level the playing field for

small businesses, it also cut everyone’s taxes.

Martinez defended her veto in a press release, calling SB9 “misguided

and arbitrary.”

“Increasing taxes on grocery stores, clothing retailers and home

improvement stores, while choosing to cut taxes for a different sent

of corporations – such as large banks, casinos, payday loan companies,

or any other large corporation that pays corporate income tax – is not

only misguided and arbitrary tax policy, but it’s also not the way to

foster economic growth in New Mexico,” the statement says.

Wirth’s bill, as initially written, would have covered all

out-of-state corporations, including banks, but was watered down in

committee during the session to affect only multi-state retail stores.

“She’s operating under the Republican mantra of ‘no new taxes,'” said

Mayes. “She got backed into a corner with a bill that actually lowered

taxes but including all those businesses, 500 of them, by closing the

loophole. She sided with out-of-state companies – the one percent –

over New Mexico businesses.”

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