« 3/09: Pelosi Boot Camp Candidate Training | Main | ProgressNow Ranks Worst Gov Martinez Vetoes of NMLEG 2012! »

Wednesday, March 07, 2012

NM Green Chamber Expresses Disappointment with Governor Martinez' Veto of Senate Bill 9

Green chamber of commerceThe New Mexico Green Chamber of Commerce expressed its deep disappointment with Governor Martinez' veto of a measure to close a tax-loophole that allows "big-box" companies to claim their profits in states that don't have corporate income tax. New Mexico is the last Western state that allows "big-box" companies to use this loophole to avoid taxes and shift the tax burden onto the backs of Main Street business.

Senate Bill 9 (SB9), sponsored by Senator Peter Wirth of Santa Fe, was approved by a bi-partisan vote in the 2012 New Mexico State Legislature, after nearly a decade of attempts. Martinez' veto means that New Mexico small businesses will continue to pay more in corporate income taxes than their out-of-state "big box" competitors.

"Vetoing SB9 keeps New Mexico owned businesses at a disadvantage against big-box stores," said Doug Zilm, NMGCC member. "As a grocery store manager, who pays his fair share of taxes because I'm part of this community, I'm terribly disappointed the Governor would protect this tax loophole for out-of state corporations. I'm worried that the Governor doesn't support the small businesses that support New Mexico."

Small businesses across New Mexico compete every day against out-of-state corporations and across the nation, small businesses have generated 65% of net new jobs over the last two decades. Whereas according to a 2007 study by UC Irvine, Clark and Cornell University, for every 1 job created by a store like Wal-Mart, 1.4 jobs are lost as existing businesses downsize or close.[1]

On Monday more than 50 small businesses submitted a letter to Governor Martinez asking her to sign SB9 (http://library.constantcontact.com/download/get/file/1104335014834-205/NMGCC+Letter+to+GovMartinez.pdf)

If signed into law, SB9 would have lowered taxes on all corporations and mandated that out-of-state corporations with retail spaces more than 30,000 square feet in size report their combined earnings from all subsidiaries for tax purposes. Without mandatory combined reporting, many choose to file at alternative corporate addresses in states with no corporate taxes.

[1] www.newrules.org/retail/neumarkstudy.pdf by David Neumark (University of California-Irvine), Junfu Zhang (Clark University), and Stephen Ciccarella (Cornell University), IZA Discussion Paper No. 2545, Jan. 2007

March 7, 2012 at 11:54 AM in Business, Corporatism, NM Legislature 2012, Susana Martinez, Taxes | Permalink