New Mexico has a gross receipts tax (GRT) instead of a sales tax. The GRT is imposed on businesses or people who sell goods or services, lease property, license property, or license a franchise in the state. Prescription medicine, groceries, and gasoline are exempt.
Registration and Reporting
To register, apply online for a tax identification number. Employees and independent contractors use different forms. Receipts that are exempt do not require reporting.
Exemptions and Rates
The tax location for real property sales or leases is the property site. Restaurant meals may have special rates. New Mexico has over 40 exemptions for organizations like nonprofits, governmental agencies and tribes.
GRT is imposed on the seller, not the buyer. However, sellers often pass the tax on to buyers by including it in the total purchase price. The state GRT rate is 5.125%. Total rates range from 5% to 9.3125%, depending on the county and city.
Compliance and Funding
Almost every tax dollar New Mexico collects pays for state services and programs. Lawmakers decide how much tax citizens pay, what is taxed, and how the money is spent.
Most businesses must register with the Taxation and Revenue Department (TRD) before collecting GRT. Registration is online or by mail. Filing frequency depends on business type. The TRD offers resources to help business owners understand GRT laws and manage compliance.