Competitive Business Climate

Improvements to New Mexico’s tax climate have been recognized by Kiplinger, Ernst & Young, and the Tax Foundation.  The state recently phased down its maximum corporate income tax rate to 5.9% and enacted a single sales factor apportionment methodology for manufacturers.

  • New Mexico does not tax property-in-transit through the state or warehoused for delivery out-of-state
  • No inventory tax
  • No gross receipts tax on consumables used in manufacturing, including electricity and natural gas
  • No intangible property tax
  • No tax on real estate transactions
  • Lowest property tax in the nation
  • Single sales factor apportionment methodology for manufacturers 
  • No estate, inheritance or gift taxes

A comparison of regional states from the 2019 State Business Tax Climate, published by the Tax Foundation, is shown below.

  Overall State Business Climate Ranking Maximum CIT Rate Maximum PIT Rate
New Mexico 25 5.9% 4.9%
Arizona 27 4.9% 4.54%
California 49 8.84% 13.3%
Colorado 18 4.63% 4.63%
Oklahoma 26 6% 5%
Nevada 9 None None
Texas 15 None None
Utah 8 4.95% 4.95%

 

  State Sales Tax Rate Property Tax - Collections Per Capita
New Mexico 5.125% $770
Arizona 5.6% $1,036
California 7.25% $1,451
Colorado 2.9% $1,382
Oklahoma 4.5% $678
Nevada 6.85% $959
Texas 6.25% $1,731
Utah 5.95% $976