Taxation secretary outlines session priorities: quantum incentives, kinship care exemption, veterans property changes and tax-code cleanup

Senator Carrie Hamblin, chair of the Tax, Business and Transportation Committee, opened the committee’s organizational meeting and introduced Chardonn Clark, secretary of the Taxation and Revenue Department, who outlined the administration’s tax priorities for the legislative session.

Clark told the committee the administration is seeking a “responsible” and sustainable package of recurring tax changes and highlighted proposed incentives to attract quantum computing infrastructure, a personal income tax exemption for foster and kinship caregivers, statutory language to implement recent veteran property tax constitutional amendments, and large tax-code cleanup bills.

The quantum proposals include two credits, Clark said: an infrastructure tax credit to offset part of the cost of quantum facilities (a maximum equal to 30% of eligible infrastructure investment before an unspecified cap, with per-facility and aggregate limits) and a state-only gross receipts tax (GRT) credit to reduce GRT liability on quantum-related services sold by New Mexico’s national laboratories. Clark said both credits would be certified by the Economic Development Department; sponsors expected to introduce the bills include Representative Dixon (House) and Senator Padilla (Senate). Specific aggregate caps were not yet finalized and Clark said she would provide details to the committee as they are determined.

Clark described a proposed personal income tax exemption for families who foster and for kinship caregivers (for example, grandparents or aunts and uncles who provide legal custody). An earlier slide in the presentation listed a lower estimate; Clark updated the committee that the current revenue estimate for exempting all kinship care providers is about $19.2 million, with roughly half of beneficiaries estimated to be grandparents. Clark said there is not currently an income threshold in the administration’s concept but that the matter has been discussed internally.

On property-tax changes, Clark said House Bill 47 (carried in the House by representatives de la Cruz and Alan Martinez) would implement two constitutional amendments approved by voters in November 2024. The bill would raise a standard veterans property-tax exemption from $4,000 to $10,000 and change the disabled‑veterans exemption from an all-or-nothing 100% exemption to a prorated exemption tied to the veteran’s disability percentage (for example, a 10% disability would yield a 10% exemption). Clark said the bill is time sensitive because county assessors must mail notices of value by April 1 and that the administration has discussed fast-tracking the measure.

Clark also previewed large, technical tax-code cleanup bills drafted after a multi-year review of Chapter 7. She said one bill exceeds 400 pages and the package would repeal roughly 70 obsolete or duplicative statutory provisions, fix outdated agency names and authority references, and move administrative processes forward (for example, allowing electronic filing of tax liens instead of in-person filings at county clerks’ offices). Clark said the bills include an inflation-adjustment package for statutory penalties (some penalties had not been adjusted since the 1960s) and an increase in the de minimis interest threshold from $1 to $10 to reduce administrative burden.

Clark said the department also intends to match federal criminal penalties for unlawful disclosure of confidential tax information by elevating current state misdemeanor penalties to felony level to mirror federal law; she said the department does not expect the change to apply often but that it would align state statute with federal standards.

Committee members asked follow-up questions. Senator Wirth asked whether the kinship/foster exemption would include an income threshold; Clark said no threshold is currently contemplated but that it is under discussion. Senator Figueroa asked whether House Bill 47’s language addresses types of military discharge; Clark said the bill text does not now address discharge types and she would consult with the Department of Veterans Services and update the committee. Senator Worth asked about cap levels on the quantum credits; Clark said caps were not yet finalized and that the administration would provide proposed limits shortly.

No formal votes or committee actions were taken during the presentation. Clark invited committee members to contact her office or department staff with questions and to review the department’s fiscal impact estimates (FIRs) as bills are filed.

The committee recessed to meet again on Thursday for further agency presentations and to begin bill hearings.