The implementation of SB475 is expected to promote access to mental health services by making counseling and therapy more affordable for consumers, as the tax deduction may enable providers to lower their fees. Furthermore, this bill aligns with ongoing state efforts to strengthen mental health care by encouraging licensed professionals to offer their services without the added pressure of high tax liabilities. Such incentives might attract more individuals into the counseling profession, effectively expanding the workforce in mental health fields.
Summary
Senate Bill 475, introduced in the 2023 New Mexico Legislature by Gerald Ortiz y Pino, establishes a gross receipts tax deduction for licensed counselors and therapists. This legislation aims to alleviate the financial burden on professionals in the counseling and therapy fields by enabling them to deduct their service receipts from their gross income, provided these services fall within the scope of their licensed practice. The bill sets the expiration for this deduction at July 1, 2028.
Contention
While there appears to be support for the bill within the legislature, discussions around its funding mechanisms and the potential revenue loss for the state could ignite contention. Legislators may need to consider the balance between providing necessary support for mental health professionals and maintaining adequate state revenues. Additionally, the requirement for the state department to compile annual reports on the effectiveness of the deduction could lead to debates regarding the adequacy of the data and methodologies used for evaluation.