Santa Fe – Yesterday, the House of Representatives passed three bills that support New Mexico’s economic development, infrastructure, and jobs. House Bill 165, the Modifying High Wage Jobs Tax Credit Act, sponsored by Rep. Candie Sweetser (D-Deming); House Bill 176, the Broadband Telecomm Facility Gross Receipts Act, sponsored by Rep. Jim Trujillo (D-Santa Fe) and Sen. Carlos Cisneros (D-Questa); and House Bill 184, the Apprenticeship Program Income Tax Credits Act, sponsored by Rep. Linda Trujillo (D-Santa Fe).
House Bill 165 amends the high-wage jobs tax credit, which was changed in numerous ways during the 2016 special session to modify the credit. This bill will reduce the percent value of the credit from 10 percent to 8.5 percent but increase the annual per-job maximum by $750, and removes all business eligibility requirements other than eligibility for the Job Training Incentive Program (JTIP). The bill also reduces the number of weeks a job must be held from 48 to 44, and makes minor modifying language. House Bill 165 also removes most of the current restrictions preventing businesses from using the credit if they shed other jobs, and it reduces from five years to two years the restriction on claims by companies that previously ceased business operations.
House Bill 176 proposes a gross receipts tax and compensating tax deduction for the value of broadband telecommunications network facilities components. The purpose of the deduction is to promote the deployment of broadband telecommunications services in the state. The deduction is to be separately stated, but there is no penalty for failure to separately state the value of the deduction. The Tax and Revenue Department is required to gather the data and report annually to the legislature as to the cost and benefits of the deduction. The technical requirement is that network facilities must meet or exceed the federal communications commission “connect America” standards. The effective date of this bill is July 1, 2019. The provisions are repealed as of July 1, 2028.
House Bill 184 creates apprenticeship program income tax credits applicable to both the Income Tax Act and the Corporate Income and Franchise Tax Act. The credit allowed per “qualified apprentice” is $1,000 for a full year or $2,000 for a full year if the qualified apprentice received a high school diploma or high school equivalency credential less than four years prior to the apprenticeship. If the qualified apprentice is employed for less than the full taxable year but was employed for at least seven months during that year they are eligible for the credit but can only claim part of the credit based on the amount multiplied by the fraction of the full year the apprentice was employed.
“We have an opportunity to expand job training and apprenticeship programs, create jobs, and invest in our local communities by expanding broadband which we need to compete in today’s job market,” said Chairman of the Taxation and Revenue Committee, Rep. Jim Trujillo (D-Santa Fe). Our state’s economy is at a turning point, and we must invest in our state and people if we want to see things turn around. I am optimistic that these measures will make it through the Senate and will help enact the positive changes that our state needs.”
House Bill 165, House Bill 176, and House Bill 184 now head to the Senate for consideration.