New Mexico

When states operate their tax scheme via a flat rate, it is a fairly simple process whereby you set the rate and go on to other matters. But when you get into tax incentives, things can get tricky, as today's Farmington Daily Times illustrates.

In New Mexico, lawmakers wanted to attract investment to "rural" areas. But New Mexico deputy secretary for economic development Kelly O'Donnell noted that

one difficulty for the state is in defining a "rural area." There are three major programs that provide specific incentives for rural areas, and all have a different definition for what qualifies as rural, O'Donnell said. A community like Farmington will qualify for some programs, but not for others, she said.

As the article discusses, only you get through the thorny statutory interpretation issues, evaluating whether the incentives work as originally intended is a whole other can of worms.