facebook-24x24

By Paul Gessing

New Mexico has a golden opportunity right now. The discovery of incredible oil riches in the Southeastern part of our State is not just a once-in-a-generation opportunity. Rather, it is the kind of thing that happens only rarely in the history of any state or nation. It is the kind of opportunity that we simply cannot let slip through our fingers.

Thanks to new discoveries in the Permian Basin New Mexico has seen oil production triple since 2012. It will likely double again by 2021. That is great news and it has boosted New Mexico’s sluggish economy. In May, for the first time since 2013, the State’s job growth exceeded the national average.

That’s very good news, but in spite of this phenomenal growth in the Permian New Mexico has the 2nd-highest unemployment rate in the nation and both job and overall economic growth lag far behind those of our fast-growing neighbors like Texas, Arizona, and Utah.

As was reported recently in the latest “Kids Count” report, New Mexico children face the worst overall conditions of any state. The underlying issue is poverty. And, while raising an entire State out of long-standing poverty is not easy a diversified and thriving economy will certainly help.

While the oil revenue is welcome, there are dangers. In their post-session review the LFC noted that 35 percent of the State’s revenues are now directly dependent on the oil and gas industry. That’s up from just 26 percent. It is dangerous to rely so heavily on any one industry and oil prices are notoriously volatile.

It is high time that New Mexico diversify its economy. The oil boom is a valuable tool that policymakers can use to achieve that goal.

The shortest path to economic diversification is to finally reform the unfair, anti-business, and regressive gross receipts tax. The Rio Grande Foundation has long argued for reform of the GRT. In 2019 many of the “revenue enhancing” pieces of a prospective revenue-neutral tax reform were adopted (Internet sales taxes and taxes on non-profit hospitals and managers of our National Labs for example).

But with all of these “revenue enhancements” already in place and the State expecting yet another massive oil-funded surplus it is critical for the future of our State that the Legislature and Governor reform the GRT to benefit New Mexico for decades to come.

This is an issue of bi-partisan concern. The GRT harms entrepreneurs and any small business that doesn’t have the money to hire a lobbyist to get an exemption. And, as a petition up on the liberal website MoveOn.org notes, doctors who accept Medicaid are forced to pay gross receipts taxes on those already-low disbursements under that program. The active petition was put there by a clinical psychologist currently working with Native American youth and families. Certainly, if lifting New Mexicans out of poverty is a “progressive” goal it makes no sense to tax the vanishingly few medical providers who are willing to take on large numbers of Medicaid patients.

It is time to lower the GRT rate and eliminate taxes on service providers to small businesses including bookkeepers, accountants, website managers, and numerous other basic business services, which are taxed here in New Mexico at rates exceeding 8 percent while those same services are untaxed in most other states.

Outside of oil and gas, New Mexico is lacking in terms of the number of startups and fast-growing small businesses. Some of today’s small businesses will grow up to become tomorrow’s corporate community that pumps money back into the local economy while consistently generating jobs and providing a literal foundation for future economic prosperity. For too long New Mexico’s tax structure, thanks to the GRT, has made New Mexico unattractive as a location.

The 2020 legislative session provides a unique opportunity to change that.

Paul Gessing is the President of New Mexico’s Rio Grande Foundation. The Rio Grande Foundation is an independent, non-partisan, tax-exempt research and educational organization dedicated to promoting prosperity for New Mexico based on principles of limited government, economic freedom and individual responsibility

Live from Silver City

Join GCB Three Times Weekly Updates

Welcome to Three Times Weekly Updates! You will be subscribed to email notifications with links to recently posted articles.
captcha 
You can unsubscribe anytime. We never share or rent your email to anyone.

Fire Alerts

Editor's Note

FILLED: Classified for Silver City church seeking office manager. Check back often for new classifieds.

Those new to providing news releases to the Beat are asked to please check out submission guidelines at https://www.grantcountybeat.com/about/submissions. They are for your information to make life easier on the readers, as well as the editor.

Classifieds: We have changed Classifieds. Check periodically to see if any news ones have popped up. The former software failed us, so it's just a category now, with prices posted. Send your information to editor@grantcountybeat.com and we will post it as soon as we can. Instructions and prices are on the page.

Images: We have received complaints about large images blocking parts of other articles. If you encounter this problem, click on the title of the article you want to read and it will take you to that article's page, which shows only that article without any intruders. It's a software problem, not easily fixable, other than showing fewer articles per summary page. If you are a frequent visitor, you might not mind fewer articles per page, but if you only come once in a while, you likely want to see more articles to browse. Write me at editor@grantcountybeat.com to let me know your feelings on this issue. 

Compliance: Because you are an esteemed member of The Grant County Beat readership, be assured that we at the Beat continue to do everything we can to be in full compliance with GDPR and pertinent US law, so that the information you have chosen to give to us cannot be compromised. 

New Columnists: The Beat continues to bring you new columnists.Recent additions  include one about end of life options, Compassionate Care.

The Beat has a column for you gardeners out there. The Grant County Extension Service will bring you monthly columns on gardening issues. The first one posted is on Winterizing your houseplants and patio plants.

The Beat totally appreciates its readers and subscribers!  

WARNING:

All articles and photos indicated by a byline are copyrighted to the author or photographer. You may not use any information found within the articles without asking permission AND giving attribution to the source. Photos can be requested and may incur a nominal fee for use personally or commercially.

NOTE: If an article does not have a byline, it was sent to the Beat and written by someone not affiliated with the Beat

Don't forget to tell advertisers that you saw their ad on the Beat.

Newsletter: If you subscribe to the Join GCB Three Times Weekly Updates option on the left side of this page, you will be subscribed to email notifications with links to recently posted articles.

Here for YOU: Consider the Beat your DAILY newspaper for up-to-date information about Grant County. It's at your fingertips! One Click to Local News.

Feel free to notify editor@grantcountybeat.com, if you notice any technical problems on the site. Your convenience is my desire for the Beat. 

Disclaimer: If you find errors in articles not written by the Beat team but sent to us from other content providers, please contact the writer, not the Beat. For example, obituaries are always provided by the funeral home or a family member. We can fix errors, but please give details on where the error is so we can find it. News releases from government and non-profit entities are posted generally without change.

Thanks for your support for and your readership of Grant County's online news source—www.grantcountybeat.com

20191110