New Mexico has a graduated state individual income tax, with rates ranging from 1.50 percent to 5.90 percent. New Mexico has a flat 5.90 percent corporate income tax rate, a 4.88 percent state gross receipts tax rate, and an average combined state and local rate of 7.67 percent. New Mexico has a 0.63 percent effective property tax rate on owner-occupied housing value. New Mexico does not have an estate tax or inheritance tax. New Mexico’s gas tax is 18.88 cents per gallon, and its cigarette excise tax is $2.00 per pack of 20 cigarettes.
New Mexico raises tax revenue primarily through other taxes (37.4 percent of total state and local tax revenue), general sales taxes (32.5 percent), and individual income taxes (14.0 percent). New Mexico collects $8,953 in state and local tax collections per capita, carries $6,281 in state and local debt per capita, and has a 68 percent funded ratio of public pension plans. New Mexico’s tax system ranks 28th overall on the 2026 State Tax Competitiveness Index.
Each state’s tax code is a multifaceted system with many moving parts, and New Mexico is no exception. Use the tabs below to compare New Mexico taxes with other states and to see how New Mexico raises tax revenue. You can also browse our tax maps, which are compiled from our annual publication, Facts & Figures 2026: How Does Your State Compare?
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The State Tax Competitiveness Index enables policymakers, taxpayers, and business leaders to gauge how their states’ tax systems compare. While there are many ways to show how much state governments collect in taxes, the Index evaluates how well states structure their tax systems and provides a road map for improvement.
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Facts & Figures serves as a one-stop state tax data resource that compares all 50 states on over 40 measures of tax rates, collections, burdens, and more.
2 min read
Individual income taxes are a major source of state government revenue, accounting for more than a third of state tax collections. How do income taxes compare in your state?
9 min read
Retail sales taxes are an essential part of most states’ revenue toolkits, responsible for nearly a quarter of combined state and local tax collections.
18 min read
Forty-four states levy a corporate income tax, with top rates ranging from a 2 percent flat rate in North Carolina to an 11.5 percent top marginal rate in New Jersey. Four states—Georgia, Nebraska, North Carolina, and Pennsylvania—reduced their corporate income tax rates effective January 1, 2026.
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Property taxes are the primary tool for financing local governments. While no taxpayers in high-tax jurisdictions will be celebrating their yearly payments, property taxes are largely rooted in the benefit principle of taxation: the people paying the property tax bills are most often the ones benefiting from the services.
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Wireless taxes and fees set a new record high in 2024.
23 min read
Legal sports betting has grown rapidly since the Supreme Court granted states the ability to establish online sports betting markets in Murphy vs. NCAA in 2018.
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Taxes are on the ballot this November—not just in the sense that candidates at all levels are offering their visions for tax policy, but also in the literal sense that voters in some states will get to decide important questions about how their states raise revenue.
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The latest IRS and Census data show that people and businesses favor states with low and structurally sound tax systems, which can impact the state’s economic growth and governmental coffers.
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States would do better to broaden the sales tax base to include currently exempt classes of final consumption than to impose disproportionate taxes on prepared foods.
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While many factors influence business location and investment decisions, sales taxes are something within policymakers’ control that can have immediate impacts—especially as a large number of major cities have combined rates of 9 percent or more.
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Property taxes are the primary tool for financing local governments and generate a significant share of state and local revenues.
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Though gas taxes are intended to serve as user fees and pollution deterrents, they vary widely across states. How does your state’s burden compare?
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According to recent reports, 72 percent of the current marijuana market in the US is illicit. Evidently, the federal criminalization of marijuana has failed to prevent its sale or consumption.
6 min read
As much as 98 percent of vaping products sold in the US are illicit. Most states levy an excise tax on vaping products, but these tax systems vary substantially. The result is a messy tax system covering largely illicit products, and no one knows whether taxes are being collected and remitted on most products sold nationwide.
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