SANTA FE, N.M. (AP) — New Mexico's Democratic governor has signed economic relief legislation that provides $600 rebates to low-income workers and a tax holiday for restaurants that have been hobbled by aggressive pandemic health restrictions.
Gov. Michelle Lujan Grisham on Wednesday signed two bills that are part of an ambitious economic recovery package. New Mexico state finances and trust funds are rebounding amid a surge in oil production and prices, along with a boost from 2020 federal relief to state and local government, businesses, the unemployed, school districts and tribal governments.
“This pandemic has been devastating for everyone, but the pain has been spread unequally,” Lujan Grisham said in a statement. “My hope is these economic relief efforts reach those who need them most.”
States including New Mexico are not waiting on more federal help as they approve coronavirus aid packages for residents and business owners devastated by the economic fallout from the pandemic.
A newly signed bill from Democratic Sens. Peter Wirth of Santa Fe and Siah Correa Hemphill of Silver City provides a four month holiday from gross receipts taxes on sales and business services for business operators at restaurants, bars, food trucks, small breweries, wineries and craft distilleries. Instruction for claiming the tax benefit will be distributed later by state taxation officials.
The bill’s break for low-income workers applies to 200,000 people who typically claim the state’s working families tax credit for individuals earning $31,200 and joint filers who earn up to $39,000. It applies to 2020 filings for personal income tax with the Taxation and Revenue Department.
The state will forgo an estimated $200 million in general fund revenue. Local governments are reimbursed for lost tax income.
The second bill from Democratic Sen. Jacob Candelaria of Albuquerque expands an emergency loan program for businesses that lost income after the pandemic hit in 2020.
It would authorize loans of up to $150,000 to small businesses at sub-prime rates of less than 2% annual interest with a payback term of up to 10 years.
Those terms are more generous to borrowers than the original relief program that provided $40.5 million in loans last year. Prior relief loans can be refinanced under the new terms.
The New Mexico Finance Authority can tap up to $460 million from the Severance Tax Permanent Fund to fulfill loan requests.