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It must be spring – spring in an election year. The first candidate of the season has beat the hummingbirds to my front doorstep. She is walking my neighborhood, petition and voter registration list in hand, asking for a signature.
She’s running for the Legislature. What’s her top priority, I ask. Changing the tax law that reduces income tax for rich people – the one enacted when Richardson was governor.
Here’s the problem, I say. Before this tax rate change, New Mexico had the highest income tax in the region for the wealthy. Rich people can choose where they live, and will choose states where the tax rates are favorable. States compete for them.
Long ago, I thought New Mexico was so enchanting that our tax rates wouldn’t matter, but I grew up.
Rich people are good for the state. They bring not just wealth, but business opportunities, jobs, and support for the arts. The top prize, where New Mexico loses every time, is where companies choose to locate corporate headquarters. That’s where the big philanthropy is.
The ostensible purpose of the change in tax rates was to encourage rich people to move here. Did it work? I have previously discussed this with a seasoned legislator, who told me there isn’t any data on this question.
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