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N.M. scraps state income tax on troops

New Mexico has joined the handful of states that does not tax the pay of active-duty service members after Gov. Bill Richardson signed that change into law March 16.

Richardson cited the change as one of many successes in the New Mexico legislature’s 2007 session, which he called “one of the most productive in the state’s history.”

The tax savings will average about $1,350 per year for an estimated 10,000 active-duty military members in the state and $133 per year for the roughly 3,000 National Guard and reserve personnel who will serve at least part of the year on active duty, according to the New Mexico Department of Taxation and revenue.

Other achievements noted by Richardson in the recent legislative session included raising the state minimum wage to $7.50 per hour over the next two years and passing a “working families” tax cut returning $52 million to low- and middle-income families.

In his “state of the state” speech in January. Richardson pointedly called for the elimination of state income tax on active-duty service members, whom he said are “making enormous sacrifices on behalf of our state, our country, and our freedom.”