Smith: Gross Receipts Tax Rules Like Swiss Cheese

John Arthur Smith

Santa Fe New Mexican - Deming Democratic Sen. John Arthur Smith often compares New Mexico's gross-receipts tax to Swiss cheese. He is referring to all the tax breaks -- exemptions, deductions and credits -- that make the statewide levy as holey as, well, Swiss cheese.

In the decades since New Mexico's gross-receipts tax was created, the average rate statewide has risen to more than 7 cents on every dollar, up from 4 cents. The rate is currently just more than 8 cents in Santa Fe. The increase is, in part, due to all the tax breaks added over time that siphon away revenue, putting upward pressure on the tax rate, Smith says. Take enough revenue out of a broad-based tax, and the only way to raise the same amount of money is to raise the rate, he says. Read full story here: News New Mexico

Smith: Gross Receipts Tax Rules Like Swiss Cheese