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On July 25, 2025, New Mexico Governor announced a new tax reform bill aimed at generating additional revenue for the state. The bill, which has been named the Revenue Enhancement Act, is set to overhaul the state's tax system and increase taxes on high-income earners and corporations.Under the proposed legislation, individuals earning more than $250,000 per year will see an increase in their income tax rates, with the top marginal rate set to rise to 10%. Currently, the top rate is at 8.5%. Additionally, corporations will also face higher taxes, with the corporate tax rate increasing from 5% to 7%.Governor stated that the tax reform is necessary to address the state's budget deficit and fund essential services such as education, healthcare, and infrastructure. With the Revenue Enhancement Act, the state expects to generate an additional $500 million in revenue annually.Critics of the bill argue that increasing taxes on high-income earners and corporations could lead to businesses relocating to other states with lower tax rates. However, supporters of the legislation believe that the tax reform is necessary to ensure that New Mexico can continue to provide critical services to its residents.The Revenue Enhancement Act will now move to the state legislature for consideration and debate. Lawmakers are expected to hold hearings and gather input from stakeholders before voting on the bill. If passed, the new tax rates are set to go into effect at the beginning of the next fiscal year.Overall, the proposed tax reform in New Mexico aims to address the state's financial challenges and ensure that it can meet the needs of its citizens. As the debate over the Revenue Enhancement Act unfolds in the coming weeks, it remains to be seen whether the bill will garner enough support to become law.