New Mexico Administrative Code › Title 3 - TAXATION › Chapter 2 - GROSS RECEIPTS TAXES › Part 21 - IMPOSITION AND RATE OF GOVERNMENTAL GROSS RECEIPTS TAX › Section 3.2.21.9 - LICENSED ENTITIES PROVIDING HEALTH CARE SERVICES

Current through Register Vol. 35, No. 13, July 16, 2024
A. On and after July 1, 1992, the
				governmental gross receipts tax does not apply to receipts of any entity
				primarily engaged in providing health care services if the entity is licensed
				by the New Mexico department of health.
B. Examples of entities providing health care
				services: general and special hospitals, nursing homes, diagnostic and
				treatment centers, rehabilitation centers and home health care
				services.
C. If the receipts of an
				entity licensed by the New Mexico department of health are principally from
				engaging in the provision of health care services, none of the entity's
				receipts are subject to the governmental gross receipts tax.
D. Example: Hospital H is an institution of
				the state of New Mexico, principally engaged in the provision of health care
				services. The hospital is licensed by the New Mexico department of health. The
				hospital operation includes a cafeteria and vending machines for the
				convenience of staff, patients and visitors. None of the receipts of H,
				including receipts from operating the cafeteria and vending machines, are
				subject to the governmental gross receipts tax.
E. A licensed entity may be either an agency,
				institution, instrumentality or political subdivision of the state of New
				Mexico or may be only a component of such an agency, institution,
				instrumentality or political subdivision. When that entity is an agency,
				institution, instrumentality or political subdivision of the state, the
				receipts of that agency, institution, instrumentality or political subdivision
				are not subject to the governmental gross receipts tax. If that entity is only
				a component of an agency, institution, instrumentality or political
				subdivision, the exception under Section
				7-9-4.3
				NMSA 1978 to the imposition of the governmental gross receipts tax applies only
				to the receipts of the entity and not to receipts from other components if
				those other components either are not principally engaged in providing health
				care services or are not licensed by the New Mexico department of health. The
				receipts of the agency, institution, instrumentality or political subdivision
				from taxable activities through its components which are not principally
				engaged in providing health care services or licensed by the New Mexico
				department of health are subject to the governmental gross receipts
				tax.
F. Example 1: County C owns
				and operates a hospital licensed by the New Mexico department of health to
				provide health care services for its residents. County C has no other
				components principally engaged in the provision of health care services. The
				county, through its non-hospital components, has receipts from taxable
				activities, such as receipts from operating landfills and selling tangible
				personal property in facilities open to the general public. The receipts of
				County C from taxable activities conducted by its components other than the
				hospital are subject to governmental gross receipts.
G. Example 2: University N, an institution of
				the state of New Mexico, operates a teaching hospital licensed by the New
				Mexico department of health. The hospital's primary purpose is to provide
				health care services even though it is also a facility for teaching health care
				professionals. The other components of the university provide educational
				services, sell tangible personal property to the general public, conduct
				athletic and entertainment services in facilities open to the general public
				and provide lodging. The exception from the imposition of the governmental
				gross receipts tax applies only to the receipts of the university from the
				hospital; it does not apply to the receipts from taxable activities of other
				components of the university.