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F I S C A L   I M P A C T   R E P O R T

 

 

 

SPONSOR:

Sharer

 

DATE TYPED:

2-17-03

 

HB

 

 

SHORT TITLE:

Income Tax Deduction for Certain Teachers

 

SB

518

 

 

ANALYST:

Neel

 

 

 

REVENUE

 

Estimated Revenue

Subsequent

Years Impact

Recurring

or Non-Rec

Fund

Affected

FY03

FY04

 

 

 

 

($30,000.0)

($30,000.0)

Recurring

General Fund

 

 

 

 

 

(Parenthesis ( ) Indicate Revenue Decreases)

 

SOURCES OF INFORMATION

 

Responses Received From:

 

State Department of Education (SDE)

Taxation and Revenue Department (TRD)

 

SUMMARY

 

     Synopsis of Bill

 

Senate Bill 518 enacts a new section of the Income Tax Act to provide a deduction for certified elementary and secondary teachers in the amount equal to the total income received from providing instructional services.  Under SB 518 a “certified teacher” is defined as a person who is employed by a school to teach or provide special instructional services and who has received a certificate from the state Board of Education authorizing them to teach or provide special instructional services in the public schools.

 

     Significant Issues

 

FISCAL IMPLICATIONS

 

According to TRD:

Statistics shown on the New Mexico Department of Education website indicate approximately 21,000 teachers work in New Mexico public schools, and that their salaries average approximately $37,000 annually. The 21,000 figure does not include private-school teachers and other individuals, for example occupational therapists that provide instructional services. The estimate above therefore assumes 23,000 individuals will qualify for the exemption, their net income averages roughly $26,000 annually and, their tax obligations average $1,300 annually. Hence the tax reduction resulting from the proposed measure would total $1,300 x 23,000 or $30 million.

 

SN/njw