New Mexico ranks first
in the West for manufacturers.
According to a report released by Ernst & Young in January 2014, New Mexico has the lowest effective tax rate for manufacturers in the nine-state Western region and the New Mexico Jobs Package was a factor in the report. The package, which was signed into law by Governor Susana Martinez in 2013, will reduce the state’s corporate income tax rate 22 percent—from 7.6 percent to a top rate of 5.9 percent—by January 1, 2018. This move improved New Mexico’s ranking from 51st in the nation in a previous 2011 Ernst & Young report to now the most competitive in the West for manufacturers in just three years.
Furhermore, the New Mexico Tax Package will create additional successive improvements over three years by giving manufacturers the option to pay tax only on goods sold in state without punishing them with additional taxes on exports.
The enactment of the single sales factor for manufacturers without an investment threshold in New Mexico will phase in over a five-year period to 100 percent beginning at 50 percent in taxable year 2014. This will abate the state corporate tax liability for most manufacturers and eliminates any penalties or obstacle for new investment.
Read the full report here: