In New Mexico, there is growing concern about the lack of funds to support crucial services as the state transitions away from fossil fuels towards renewable energy. While oil, gas, and mining industries pay severance taxes, renewable energy projects do not. In an effort to address this issue, Rep. John Block introduced HB 45, a bill that would impose a renewable energy production tax similar to the severance tax paid by oil and gas companies. The bill was tabled in its first committee this week, but the conversation around taxing renewable energy projects is not going away.
Proponents of the tax argue that it is necessary to diversify the state budget and ensure that renewable energy projects contribute to funding essential services. However, opponents believe that renewable energy projects are already subject to other taxes, such as gross receipts tax, corporate income tax, personal income tax, and property tax, and that imposing an additional tax would be premature and detrimental to the state’s economic interests.
Despite the setback in passing the tax on renewable energy projects, some lawmakers are committed to addressing the issue in the future. As New Mexico looks to transition towards renewable energy and away from fossil fuels, the conversation about how to fund essential services and diversify the state budget will continue to be a pressing issue for legislators.
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