Study: New Mexico third to last in taxpayer return on investment

(The Center Square) – New Mexico taxpayers receive the third worst return on their investment according to a new study that ranks the 50 states.

To determine its rankings, personal finance website Wallethub evaluated each state’s tax burden (local and state) and compared it to the quality of services taxpayers receive in five main categories: Education, Health, Safety, Economy, and Infrastructure & Pollution.

“Different states have dramatically different tax burdens. This begs the question of whether people in high-tax states receive superior government services,” Wallethub managing editor John S. Kiernan writes. “Likewise, are low-tax states more efficient or do they receive low-quality services? In short, where do taxpayers get the most and least bang for their buck?”

While New Mexico residents pay the 14th highest local and state taxes among the 50 states, they receive the second worst services, according to Wallethub.

“New Mexico has the third lowest taxpayer ROI. Although its residents pay fairly high taxes, around $4,600, the state ranks second to last in terms of the quality of government services received,” Wallethub analyst Jill Gonzalez told The Center Square. “Looking at education, New Mexico ranks last for quality of the school system, and has the lowest public high school graduation rate – less than 74%. Moreover, this rate is projected to decrease by 2032 by more than 11%. As a direct consequence of the low graduation rate, the state also has a large share of idle youth – 16%.”

New Mexico also has among the worst crime rates in the country and the lowest average annual household incomes, according to Wallethub.

“The crime rate throughout the state is very high – second highest nationwide, and there is a large registered number of traffic fatalities,” Gonzalez said. “Additionally, the median annual household income in New Mexico is the third lowest in the country at less than $50,000, which is why the state has the third highest percentage of residents living in poverty, over 19.”

The study said New Hampshire taxpayers see the best return on their investment, followed by Florida, South Dakota and Virginia.

Taxpayers in Hawaii receive the worst return on their investment, followed by California and New Mexico.

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