A Democratic-led bill signed today by Governor Michelle Lujan Grisham brings relief to many New Mexicans who will see their tax penalties and interest waived, as well as boosts the amount of online sales tax going to local governments.
House Bill 6, sponsored by Representative Christine Chandler (D-Los Alamos), Representative Abbas Akhil (D-Albuquerque), Representative Javier Martinez (D-Albuquerque), and Senator Peter Wirth (D-Santa Fe), gives direct tax relief to individuals, businesses, and local governments economically affected by the COVID-19 pandemic.
“Far too many New Mexican households don’t know where their next paycheck will come and bills still have to be paid,” said Representative Christine Chandler (D-Los Alamos). “By providing temporary tax relief we can give some flexibility to businesses, support to local governments and keep a little bit more money in the pockets of New Mexicans.”
The bill encompasses three provisions:
First, House Bill 6 temporarily waives penalties and interest for tax liabilities related to personal and corporate income taxes, withholding taxes, gross receipts taxes, and managed audits. The waiving of penalties and interest provides relief to taxpayers unable to make payments due to the COVID-19 public health emergency.
Second, the bill doubles monthly distributions from online sales taxes to local municipalities struggling with reduced budgets during the downturn. This is especially important as more households shop online due to the COVID-19 pandemic, taking more business from traditional brick-and-mortar shops and further reducing gross receipts taxes to local governments.
Third, the bill prevents corporations from receiving increased tax benefits under the federal CARES Act, so New Mexico receives its fair share of corporate income taxes, especially important during this time of fiscal uncertainty.
Having been signed by the Governor, House Bill 6 takes effect immediately. Penalties and interest will be waived until April 2021.