New Mexicans are free to eat their tortillas after Gov. Bill Richardson vetoed the food tax Wednesday, forcing lawmakers to choke down an unbalanced budget.
The governor vetoed the legislation, passed by state lawmakers, which would reinstate a 2 percent local and county gross receipt tax on food items. The veto leaves the state budget with a $68 million shortfall for the upcoming fiscal year.
“I am not willing to put this burden on working families,” Richardson said in a statement. “It is especially cruel during the worst fiscal crisis New Mexico has ever experienced.”
UNM Senior Catherine Atencio said she agreed with the governor that taxing food items would only make it more difficult for New Mexicans to survive the recession.
“In our state, where there are already so many kids that go home hungry, it is a good thing we don’t have a food tax,” she said.
The food tax was repealed in 2004 by the state legislature, and cities began receiving payment from the state to compensate for the annual loss of revenue. Richardson said it is not necessary to bring back the tax to balance the budget.
“In 2004, I told New Mexicans that we eliminated the food tax forever, putting hundreds of dollars into the pockets of working families,” Richardson said. “I’m not about to open the door again and resurrect a tax on food that disproportionately hurts poor and middle-income families.”
Atencio said resuming the food tax would be unfair.
“I’ve always thought it was stupid, because they had already repealed it,” she said. “They haven’t had it for so long people got used to that.”
The governor said he plans to use federal stimulus money, state reserve funds and increased cigarette taxes to patch the hole in the budget.
If he is still unable to compensate for the loss of revenue, Richardson said he would use the authority granted to him this legislative session to cut funding to government agencies.
Senate Majority Leader Michael Sanchez, a Democrat from Belen, said the governor’s decision was irresponsible, and unless the economy drastically improves the next governor will have to take severe action to balance future budgets.
“The governor’s veto today puts the state’s financial future at even greater peril. His approach to balancing the budget relies heavily on general fund reserves and federal stimulus money,” Sanchez said in a statement Wednesday. “While this may work in the short term and carry him through the end of his term, these are one-time revenue sources.”
UNM Sophomore Dylan Waters said he expects to see service cuts in the future because many state revenue sources have already been tapped.
“They are probably going to cut things now. What else can they do?” he said. “We already have really high taxes on gas and cigarettes.”
Sanchez said he was surprised by the governor’s lack of support because he had not expressed his intention to veto the bill during the special session.
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“Had he indicated three weeks ago that he would not support the legislation we would have taken a different approach,” Sanchez said. “At no time during the special session did he raise any objections. He was very clear about what he wouldn’t support which is why the legislative and executive compromise we crafted didn’t include an income tax increase or a requirement that all corporations pay their fair share of taxes.”
Waters said it was dishonest for the governor to mislead lawmakers.
“It is not fair to the House members who supported the bill to go back like that,” he said. “Especially because he is not up for re-election.”
Atencio said vetoing the tax was a solid choice and using revenues from nonessential items like cigarettes was a better option for the community.
“There is always going to be budget shortfalls,” she said. “But food isn’t something you should tax, because everyone needs
to eat.”
