Coalition Representing Over One Million New Mexicans Opposes Reimposition of the Food Tax

Hey Governor Richardson and NM Legislators, are you getting the message yet? Don't even think about trying to get blood from a stone -- i.e., trying to wring more tax dollars out of hands of those who can least afford it. Our wealthiest citizens did just fine before their taxes were significantly cut in 2003. The measure decreased the top state income tax rate from 8.2% to 4.9%, phased in over several years. We need to put it back where it was. Those who have made out like bandits over the past eight years need to pay their fair share now that the Bush "recession" is in full swing.

And while we're at it, let's make multi-state corporations doing business in New Mexico -- like Walmart, K-Mart and Home Depot -- to pay income tax on the profits they make here. Let's use the "combined reporting" method of taxation, as do a majority of states that tax corporations.

Above all, don't reapply the tax on foods.

The New Mexico Conference of Catholic Bishops, the New Mexico Conference of Churches, AARP and the Santa Fe Alliance business group are among a growing list of organizations that have joined with Think New Mexico to oppose the reimposition of the food tax. Other members of the coalition include Bread for the World New Mexico, Farm to Table, La Montanita Co-op and the Rocky Mountain Farmers Union.

Together, the membership of these organizations is well over a million New Mexicans. For example, the Catholic Church serves more than 600,000 New Mexicans and AARP has about 280,000 members.

The Greater Albuquerque Chamber of Commerce recently proposed that New Mexico reimpose the tax on food to combat the state’s budget deficit. The food tax was repealed by Governor Richardson and the Legislature four years ago. It had originally been levied in 1933 as part of a “temporary” and “emergency” tax. Today, only two states fully tax the sale of groceries: Alabama and Mississippi.

The coalition opposes the reimposition of the food tax in part because the food tax is an extremely regressive tax: those who are least able to afford it bear the greatest burden. New Mexico households with incomes between $10,000 and $15,000 spend on average 16.2% of their income on groceries, while households with income greater than $75,000 spend on average 3.8% of their income on groceries, according to a statement released by the coalition.

The food tax is also an anti-family tax because larger families purchase more groceries and would therefore pay a greater share of the food tax. The food tax would cost an average family of four about $250 per year.

Yesterday, Lieutenant Governor Diane Denish announced her opposition to reimposing the food tax. Denish stated: “When families are pinching and scraping to get by, taxing the basics like milk and bread is just not right. We need a solution to the state's budget problem, but it should not come at the cost of making tough times even tougher for regular New Mexico families.”