Rep. Conrad James
SANTA FE – The New Mexico Association of Commerce and Industry (ACI) and Rep. Conrad James recently introduced the Headquarters Operations Incentive bill. The bill is designed to make New Mexico more economically competitive by expanding a sales factor corporate income tax approach to headquarters operations.
Under the existing three-factor system, sales, payroll, and property are all used as criteria to determine corporate income tax level. ACI and James argue as a result, New Mexico businesses are actually incentivized against hiring more employees and are rewarded for cutting jobs or moving them outside of New Mexico.
Dr. Beverlee J. McClure
All but a few states have moved to a single sales factor approach and all of New Mexico’s neighboring states have either a single sales factor system or no corporate income tax at all. As a result, New Mexico’s needlessly complex tax structure is a major obstacle to attracting new businesses and jobs for New Mexicans.
ACI President and CEO Dr. Beverlee J. McClure praised James for introducing the legislation.
“Our current three-factor approach is costing us countless jobs and opportunities,” McClure said. “It is simply unacceptable that New Mexico’s tax structure rewards businesses for leaving our state and laying off New Mexicans. ACI and our members have been happy to work with Rep. Conrad James on building this strong proposal to fix the problem. Companies that move their headquarters to New Mexico bring jobs, opportunities, and expanded revenue for our local businesses—which in turn means even more jobs and more opportunities for our state.”
James, who represents parts of northeast Albuquerque, said he introduced the bill to keep jobs in New Mexico. “What kind of message does it send to businesses—both those who have already invested in New Mexico and those who want to bring jobs here—when we tell them we’ll punish them with more taxes if they create more jobs?” James asked. “Instead, we should be giving businesses every reason possible to come here, hire here, and grow here. New Mexicans are relying on their lawmakers this session to make the smart decisions that will create better opportunities for our families. This bill helps pave the way for the jobs our state needs.”
ACI serves as New Mexico’s statewide chamber of commerce and business advocate. ACI advocates for pro-jobs positions developed by its member businesses through a transparent, member-driven process.