{"id":20608,"date":"2026-03-26T14:46:51","date_gmt":"2026-03-26T20:46:51","guid":{"rendered":"https:\/\/www.nmvoices.org\/?p=20608"},"modified":"2026-05-13T15:40:43","modified_gmt":"2026-05-13T15:40:43","slug":"decoupling-protected-new-mexico-from-millions-in-lost-revenue","status":"publish","type":"post","link":"https:\/\/test.nmvoices.org\/index.php\/2026\/03\/26\/decoupling-protected-new-mexico-from-millions-in-lost-revenue\/","title":{"rendered":"Decoupling Protected New Mexico from Millions in Lost Revenue"},"content":{"rendered":"

\"\"By Emily Wildau, MPP
\nDirector of Policy
\n<\/span>March 26, 2026<\/span><\/p>\n

In New Mexico, we prioritize the health and well-being of our families and children, but we can\u2019t support them without enough state revenue for the programs and services they need to thrive. This session, state legislators and Governor Michelle Lujan Grisham passed legislation to protect revenue that would have been lost if the state did not take action.\u00a0<\/span><\/p>\n

State lawmakers have worked hard to <\/span>improve fairness<\/span><\/a> in New Mexico\u2019s tax code over the last several years, but our state practices <\/span>rolling conformity<\/b> \u2014<\/span> meaning many, but not all, federal tax changes are automatically adopted in our state tax code. Usually conformity is for administrative ease, as tax changes don\u2019t often happen on a large scale. Last summer, however, the federal government passed s<\/span>ignificant changes to the federal tax code through the One Big Beautiful Bill Act (OBBBA)<\/span><\/a>.<\/span><\/p>\n

These changes impacted both Personal (PIT) and Corporate Income Taxes (CIT), and because of rolling conformity, New Mexico lawmakers estimated a <\/span>loss of $140M – $145M in CIT revenue<\/span><\/a>. Fortunately, states have the freedom to decouple from, or reject, certain federal tax provisions at any time.\u00a0<\/span><\/p>\n

As this year\u2019s Legislative Session approached, state lawmakers discussed decoupling from a small number of federal CIT changes, and conforming to another to help prevent tax avoidance by large, multinational corporations. Ultimately, lawmakers introduced <\/span>SB 151<\/span><\/a>, which included decoupling provisions and conformity with Net CFC Tested Income (NCTI), and later became this year\u2019s tax package. The bill passed both chambers, and Governor Lujan Grisham signed it into law on March 11. To make this package revenue neutral, the expenditures in SB 151 have staggered start dates, and all the tax credits and deductions have sunset dates.<\/span><\/p>\n

So what exactly are the decoupling and conformity provisions in SB 151?<\/span><\/b><\/span><\/p>\n