For starters, take this report by the liberal “Good Jobs First.” It outlines the problem of taxpayer “subsidies” for businesses in various states. In New Mexico, they specifically criticize the “High Wage Jobs Tax Credit” which the group says reduced tax revenues by $4.6 million in 2010.
While conservative may quibble with the term “subsidy” as this credit represents revenues forgone as opposed to outright taxpayer financial support for a given industry (like the film incentive program), there is no doubt that it and other tax credits offered by the state are sub-optimal tax policy. To that end, they could and should be eliminated as part of any comprehensive or even significant tax reform in New Mexico.
If I were “Good Jobs First,” I’d focus first and foremost on the far more costly film incentive outlay ($50 million annually as opposed to $4.6 million) but conservatives can and should join principled liberals in their opposition to these targeted tax credits.