A proposal to exclude social security benefits from most new Mexicans’ personal income taxes appeared before its final committee on Thursday as the final week of the 30-day budget session approached.
The two-part SB 108 was one of several bills introduced this session that sought to exempt social security income from personal taxes, and had the support of Governor Michelle Lujan Grisham.
Senate Tax, Commerce, and Transportation Committees met in the Capitol on Thursday to act on an omnibus package that combines SB 108 with proposals to reduce gross income taxes and extend and increase a tax deduction for solar power plants.
SB 108’s Democratic co-sponsor, State Senator Michael Padilla of Albuquerque, said: “It is high time we removed the tax on social security. … We are one of only 12 remaining states still taxing social security. This is a problem that has plagued many New Mexico families in retirement. “
Padilla noted that 49 percent of New Mexico’s foster children are raised by retired grandparents, as he himself was. The cost of $ 80 million, he said, would be converted into usable income for the benefit of the economy.
If it becomes law, the exemption will take effect in the current tax year.
However, the committee’s bill limited the exemption to $ 75,000 for couples applying separately, $ 150,000 for married couples applying jointly, and $ 100,000 for individuals, meaning New Mexico will still tax social benefits for some residents.
Republicans, the New Mexico Municipal League and some Democrats on the committee removed a proposed five-year moratorium on local BRT increases that had been added to the bill.
A proposed five-year moratorium on local BRT increases was removed from the bill after Republicans and the New Mexico Municipal League raised objections, beginning with state Sen. Gay Kernan, R-Hobbs, who said it would tie the hands of local governments and compromise the public security.
Late. Peter Wirth, the majority leader of the Democratic Senate from Santa Fe, agreed to remove the moratorium and take up the issue again at another time. An amendment removing the proposal was easily adopted with bipartisan support.
Nora Meyers Sackett, the governor’s press secretary, said: “We are pleased to see that the governor’s priorities in cutting BRT and removing the tax on social security benefits have bipartisan support and are moving forward – these measures will put more money back in the pockets of hard-working new Mexicans. “
The bill’s next stop will be in the Senate Finance Committee, which did not appear to hear it until the final week of the session, which ends at noon on February 17.
This article originally appeared on Las Cruces Sun-News: New Mexico introduces bills that exempt social security from income tax