The proposed "Oil and Gas Equalization Tax Act" establishes a new taxation framework for oil and gas products severed and sold in New Mexico. It introduces a privilege tax of 0.85% on the taxable value of oil and liquid hydrocarbons, with specific definitions for terms such as "operator," "purchaser," and "taxable value." The act outlines the responsibilities of operators and purchasers in withholding taxes from interest owners and mandates reporting requirements for both parties to ensure compliance. Additionally, it allows the taxation department to determine product values under certain conditions and provides for advance payments based on average tax calculations.

The bill also amends existing tax law to include the Oil and Gas Equalization Tax Act under the jurisdiction of the Tax Administration Act, ensuring that it is governed by the same administrative and enforcement provisions as other tax acts. The effective date for the provisions of this act is set for July 1, 2025.

Statutes affected:
introduced version: 7-1-2