SENATE BILL 47

50th legislature - STATE OF NEW MEXICO - first session, 2011

INTRODUCED BY

Timothy M. Keller

FOR THE REVENUE STABILIZATION AND TAX POLICY COMMITTEE

AN ACT

RELATING TO TAXATION; REQUIRING THE SECRETARY OF TAXATION AND REVENUE TO DEVELOP A TAX EXPENDITURE BUDGET; REQUIRING REPORTING.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

     SECTION 1. A new section of the Tax Administration Act is enacted to read:

     "[NEW MATERIAL] TAX EXPENDITURE BUDGET--MANDATORY REPORT--DEADLINE.--

          A. No later than October 15 of each year, the

secretary shall compile a tax expenditure budget for the

upcoming fiscal year and present the tax expenditure budget,

including an analysis of tax expenditures, to the governor, the interim legislative revenue stabilization and tax policy committee and the legislative finance committee. The tax expenditure budget shall report on tax expenditures with revenue impacts of more than five million dollars ($5,000,000) in the aggregate for a specific tax expenditure.

          B. A tax expenditure budget shall detail the

approximate costs in foregone revenue from tax expenditures.

A tax expenditure budget shall:

                (1) include a projection of the costs of tax

expenditures for all significant general fund revenue sources;

                (2) identify each tax expenditure and its

statutory basis, purpose, year of enactment and date of repeal, if any;

                (3) quantify the revenue invested by the state

from each tax expenditure;

                (4) identify the beneficiaries of each tax expenditure, including the number of businesses that used the tax expenditure, jobs created and the number of businesses that potentially qualified for but failed to use the tax expenditure;

                (5) identify significant unintended effects of the tax expenditure that have come to the attention of the department; and

                (6) provide a total of all of the costs in

each fiscal year for all tax expenditures.

          C. The department is authorized to request from a

state agency or a local government agency official information necessary to complete the tax expenditure budget required by this section. An agency or official shall comply with a request made pursuant to this section by the department unless a specific statutory confidentiality provision prohibits doing so.

          D. As used in this section:

                (1) "jobs created" means the net increase of full-time jobs that exceeds the full-time equivalent of jobs that existed at the beginning of the reporting period, provided that the additional jobs can specifically be attributed to use of a tax expenditure, including:

                     (a) the net increase if jobs are changed from part time to full time;

                     (b) the full-time equivalent of jobs created that were previously filled by employees on contract; and

                     (c) new jobs created;

                (2) "significant general fund revenue

sources" means state taxes, including but not limited to the gross receipts tax, compensating tax, corporate income tax, personal income tax, tobacco excise tax, liquor excise tax, taxes levied on natural resource production and sale, motor vehicle excise tax, gaming excise tax and other sources of revenue such as rents and royalties, tribal revenue sharing, fire protection fund reversions, premium taxes and the leased vehicle surcharge;

             (3) "tax expenditure" means a deduction, credit, exemption, exclusion, rebate, offset, preferential tax rate, subtraction or allowance or related tax structure that reduces tax liability when compared with a normal tax system as determined by the secretary; and

                (4) "tax expenditure budget" means a

compilation of information about New Mexico's tax expenditures

that includes data from the three years preceding the current

fiscal year, the current fiscal year and the upcoming fiscal

year."

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