SENATE BILL 251

56th legislature - STATE OF NEW MEXICO - second session, 2024

INTRODUCED BY

Cliff R. Pirtle

 

 

 

 

 

AN ACT

RELATING TO TAXATION; ADJUSTING THE RATE OF THE GROSS RECEIPTS TAX TO A RATE BASED ON INDIVIDUAL SALES.

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

     SECTION 1. Section 7-9-4 NMSA 1978 (being Laws 1966, Chapter 47, Section 4, as amended) is amended to read:

     "7-9-4. IMPOSITION AND RATE OF TAX--DENOMINATION AS "GROSS RECEIPTS TAX".--

          A. For the privilege of engaging in business, an excise tax equal to [the following percentages] four and seven-eighths percent of gross receipts, except as provided in Subsections C and D of this section, is imposed on any person engaging in business in New Mexico.

                [(1) prior to July 1, 2023, five percent; and

                (2) beginning July 1, 2023, four and seven-eighths percent, except as provided in Subsection C of this section]

          B. The tax imposed by this section shall be referred to as the "gross receipts tax".

          C. If, for any single fiscal year occurring after fiscal year 2025 and prior to fiscal year 2030, gross receipts tax revenues are less than ninety-five percent of the gross receipts tax revenues for the previous fiscal year, as determined by the secretary of finance and administration, the rate of the gross receipts tax shall be five and one-eighth percent beginning on the July 1 following the determination made by the secretary of finance and administration.

          D. If the gross receipts tax imposed on an individual sale made by a person engaging in business results in a total amount that ends in an amount that does not equal a multiple of five cents ($.05), the amount of the gross receipts tax imposed on the individual sale shall be reduced so that the total amount of the sale ends in the nearest multiple of five cents ($.05), and the rate of the gross receipts tax imposed on the seller's gross receipts for the applicable taxable period shall be adjusted accordingly.

          [D.] E. On or before February 1 of each year, until the rate of the gross receipts tax is adjusted to five and one-eighth percent pursuant to Subsection C of this section, the secretary of finance and administration shall make a determination for the purposes of Subsection C of this section. If the rate of tax is adjusted pursuant to that subsection, the secretary shall certify to the secretary of taxation and revenue that the rate of the gross receipts tax shall be five and one-eighth percent, effective on the following July 1.

          [E.] F. As used in this section, "gross receipts tax revenues" means the net receipts attributable to the gross receipts tax and distributed to the general fund."

     SECTION 2. EFFECTIVE DATE.--The effective date of the provisions of this act is July 1, 2024.

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