New Mexico is shining the spotlight on businesses and some individuals who owe big money in state taxes.
More than 300 companies are included on the Taxation and Revenue Department’s list of top delinquent taxpayers, and some owe New Mexico close to $1 million in state dues. There are a few individuals peppered in throughout, but the vast majority of names on the list are businesses.
Phillip Salazar, director of Tax and Revenue’s Audit and Compliance Division, says the state uses the list to twist the arms of companies that haven’t been cooperative. “This isn’t the first tool we use to try to get businesses to pay their taxes,” Salazar says. “If we aren’t able to work something out using other methods, this helps us try to ensure that everyone pays their fair share.”
As a rule of thumb, Salazar says only people or businesses who owe at least $50,000 make the list. Salazar says his department tries to make the business or individual aware of their outstanding debt using a combination of tactics, including phone calls, personal visits and mailings. If those strategies fail and there’s enough money owed, a spot on the list is all but assured. To get taken off, those responsible for the unpaid taxes must either pony up the cash or work out an installment plan with Tax and Revenue.
Salazar says there are no specific types of businesses that tend to end up on the list. The companies run the gamut from nursing homes to restaurants to car repair shops. Nearly all the business owners who were contacted for the story did not want to talk about the list or their reasons for being on it.
Angela Romero owns the Apple Tree restaurant in Taos, which, according to the latest copy of the list, owes the state more than $158,000. Apple Tree won’t be on future editions because Romero is paying off the debt, but she says the economy has put her in a pinch. “I knew that we owed taxes, but there just wasn’t much we could do about it,” Romero says. “After Sept. 11, [2001,] things changed and we weren’t able to run our business efficiently. I’m hoping that with snowboarders being allowed in Taos, business can get better.”
Besides the unwanted publicity that being on the list can create, Salazar says interest fees and penalties make avoiding reimbursement an unattractive option. Those who don’t pay state taxes can expect to incur a 6 percent interest fee on what they owe. That means even if a business is paying a portion of what they’re obliged to, the amount that’s unpaid gets interest tacked onto it every year.
If a company hasn’t agreed to an installment plan or is late with a payment, they’re slapped with a 2 percent interest penalty every month.
Salazar says the list has helped the state recover thousands of dollars in back taxes, which he says is good news for the people of New Mexico. “The money that’s collected goes to public schools, local governments and public safety programs, among other things,” Salazar says. “It takes a certain amount of money to run a state, and when people don’t pay taxes, the burden has to be carried by the people that do.”
To view the top delinquent taxpayers list, head over to www.tax.state.nm.us.