NM Stat § 7-9-46 (2021)
2021 New Mexico Statutes|Chapter 7 - Taxation|Article 9 - Gross Receipts and Compensating Tax|Section 7-9-46 - Deduction; gross receipts; governmental gross receipts; sales to manufacturers and manufacturing service providers. (Effective January 1, 2022.)

A. Receipts from selling tangible personal property may be deducted from gross receipts or from governmental gross receipts if the sale is made to a person engaged in the business of manufacturing who delivers a nontaxable transaction certificate to the seller. The buyer delivering the nontaxable transaction certificate must incorporate the tangible personal property as an ingredient or component part of the product that the buyer is in the business of manufacturing.B. Receipts from selling a manufacturing consumable to a manufacturer or a manufacturing service provider may be deducted from gross receipts or from governmental gross receipts if the buyer delivers a nontaxable transaction certificate to the seller.C. Receipts from selling or leasing qualified equipment may be deducted from gross receipts if the sale is made to, or the lease is entered into with, a person engaged in the business of manufacturing or a manufacturing service provider who delivers a nontaxable transaction certificate to the seller; provided that a manufacturer or manufacturing service provider delivering a nontaxable transaction certificate with respect to the qualified equipment shall not claim an investment credit pursuant to the Investment Credit Act for that same equipment.D. The purpose of the deductions provided in this section is to encourage manufacturing businesses to locate in New Mexico and to reduce the tax burden, including reducing pyramiding, on the tangible personal property that is consumed in the manufacturing process and that is purchased by manufacturing businesses in New Mexico.E. The department shall annually report to the revenue stabilization and tax policy committee the aggregate amount of deductions taken pursuant to this section, the number of taxpayers claiming each of the deductions and any other information that is necessary to determine that the deductions are performing the purposes for which they are enacted.F. A taxpayer deducting gross receipts pursuant to this section shall report the amount deducted separately for each deduction provided in this section and attribute the amount of the deduction to the appropriate authorization provided in this section in a manner required by the department that facilitates the evaluation by the legislature of the benefit to the state of these deductions.G. As used in this section:(1) "manufacturing consumable" means tangible personal property, other than qualified equipment or an ingredient or component part of a manufactured product, that is incorporated into, destroyed, depleted or transformed in the process of manufacturing a product, including electricity, fuels, water, manufacturing aids and supplies, chemicals, gases and other tangibles used to manufacture a product;(2) "manufacturing operation" means a plant operated by a manufacturer or manufacturing service provider that employs personnel to perform production tasks to produce goods, in conjunction with machinery and equipment; and(3) "qualified equipment" means machinery, equipment and tools, including component, repair, replacement and spare parts thereof, that are used directly in the manufacturing process of a manufacturing operation. "Qualified equipment" includes computer hardware and software used directly in the manufacturing process of a manufacturing operation but excludes any motor vehicle that is required to be registered in this state pursuant to the Motor Vehicle Code.History: 1953 Comp., § 72-16A-14.1, enacted by Laws 1969, ch. 144, § 36; 1992, ch. 100, § 4; 2012, ch. 5, § 4; 2013, ch. 160, § 9; 2021, ch. 65, § 13; 2021, ch. 66, § 2. ANNOTATIONS2021 Multiple Amendments. — Laws 2021, ch. 65, § 13, effective July 1, 2021, and Laws 2021, ch. 66, § 2, effective January 1, 2022, enacted different amendments to this section that cannot be reconciled. The provisions of Laws 2021, ch. 66, § 2, effective January 1, 2022, are set out above. To view the session laws in their entirety, see the 2021 session laws on NMOneSource.com.Laws 2021, ch. 66, § 2 [set out above], effective January 1, 2022, added manufacturing service providers to a gross receipts tax deduction for manufacturers, and defined "manufacturing consumable", as used in this section; in the section heading, deleted "tax", and added "and manufacturing service providers"; in Subsection B, after "Receipts from selling", deleted "tangible personal property that is", preceding "consumable", added "manufacturing", after "consumable", deleted "and used in such a way that it is consumed in the manufacturing process of a product, provided that the tangible personal property is not a tool or equipment used to create the manufactured product, to a person engaged in the business of manufacturing that product and who delivers a nontaxable transaction certificate to the seller" and added "to a manufacturer or a manufacturing service provider", after "may be deducted", deleted "in the following percentages", and deleted former Paragraphs B(1) through B(5) and added "if the buyer delivers a nontaxable transaction certificate to the seller"; added a new Subsection C and redesignated former Subsections C through F as Subsection D through G, respectively; and in Subsection G, in the introductory clause, after "As used in", deleted "Subsection B of", in Paragraph G(1), added "manufacturing", after "personal property", added "other than qualified equipment or an ingredient or component part of a manufactured product", after "gases", deleted "repair parts, spares", and deleted former Paragraph F(2) and added Paragraphs G(2) and G(3).Laws 2021, ch. 65, § 13, effective July 1, 2021, provided that a taxpayer may provide the taxation and revenue department alternative evidence to claim a gross receipts tax deduction in lieu of providing a non-taxable transaction certificate, and provided that a nontaxable transaction certificate is required if the seller is a seller of electricity or fuel and is a party to an agreement with the department pursuant to a certain section of law; in Subsection A, after "certificate to the seller", added "or provides alternative evidence pursuant to Section 7-9-43 NMSA 1978", and after "The buyer", deleted "delivering the nontaxable transaction certificate"; in Subsection B, in the introductory paragraph, after "certificate", added "or provides alternative evidence pursuant to Section 7-9-43 NMSA 1978", and after "deducted", deleted "in the following percentages", and deleted former Paragraphs B(1) through B(5); and added a new Subsection C and redesignated former Subsections C through F as Subsections D through G, respectively.