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

SPONSOR Nava

ORIGINAL DATE

LAST UPDATED

2/11/08

HB

SHORT TITLE Study Nonresident Income Along Border

SM 60

ANALYST Francis

Relates to SB412

SOURCES OF INFORMATION

LFC Files

SUMMARY

Synopsis of Bill

Senate Memorial 60 requests that the interim Revenue Stabilization and Tax Policy Committee

(RSTP) study and recommend legislation regarding taxing income of nonresidents who live

along the border.

SIGNIFICANT ISSUES

There is a perception that there is inequity along the border with regard to taxation because New

Mexico taxes income and Texas does not which is restraining development in New Mexico

border communities. However, El Paso has higher sales, excise and property taxes all of which

impose a higher burden on low and middle income residents. El Paso also has a franchise tax of

4.5 percent on “earned surplus."

Major Taxes

Las Cruces

El Paso

Personal Income

4.9%

Corporate Income

7.6%

Franchise

-

4.5%

Sales

7.125%

8.250%

Property

0.9%

3.1%

Gasoline

0.17/per gallon

0.20/gallon

Cigarettes

0.91/pack

1.410/pack

Motor Vehicle Excise

3%

6.25%

CONFLICT, DUPLICATION, COMPANIONSHIP, RELATIONSHIP

Senate Bill 412 expands the industries that nonresident employees can work for and be exempt

from the personal income tax.

NF/bb