HOUSE BILL 675
47th legislature - STATE OF NEW MEXICO - first session, 2005
INTRODUCED BY
Edward C. Sandoval
AN ACT
RELATING TO TAXATION; ENACTING THE SOFT DRINK TAX ACT; MAKING DISTRIBUTIONS; MAKING AN APPROPRIATION.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
Section 1. [NEW MATERIAL] SHORT TITLE.--Sections 1 through 9 of this act may be cited as the "Soft Drink Tax Act".
Section 2. [NEW MATERIAL] DEFINITIONS.--As used in the Soft Drink Tax Act:
A. "department" means the taxation and revenue department, the secretary of taxation and revenue or any employee of the department exercising authority lawfully delegated to that employee by the secretary;
B. "soft drink" means a nonalcoholic flavored beverage containing any sweetener additive, such as corn fructose, sugar or aspartame, and includes:
(1) ginger ale and colas or drinks commonly referred to as soft drinks;
(2) any fruit or vegetable drink containing less than fifty percent natural fruit or vegetable juice; and
(3) any package or container of powder, syrup, concentrate or other base product intended for mixing to produce a liquid soft drink; and
C. "wholesaler" means a person who sells any soft drink for resale in New Mexico.
Section 3. [NEW MATERIAL] IMPOSITION AND RATE OF SOFT DRINK TAX.--An excise tax to be known as the "soft drink tax" is imposed on any wholesaler who sells soft drinks as follows:
A. three cents ($0.03) for each twelve fluid ounces of soft drink sold in New Mexico;
B. one dollar ninety-two cents ($1.92) per gallon of soft drink syrup or soft drink concentrate sold in New Mexico; and
C. on the sale of a package or container of soft drink powder or other base product, thirty-two cents ($0.32) per gallon of soft drink that may be produced from each package or container according to the manufacturer's directions.
Section 4. [NEW MATERIAL] DEDUCTIONS.--A wholesaler may deduct the value of soft drinks sold and shipped to a person in another state from the units of soft drinks subject to the tax imposed by the Soft Drink Tax Act; provided that the department may require the wholesaler to submit evidence satisfactory to the department that the units have been sold and shipped to a person in another state.
Section 5. [NEW MATERIAL] EXEMPTIONS.--Exempt from the tax imposed by the Soft Drink Tax Act are soft drinks sold to or by any instrumentality of the armed forces of the United States engaged in resale activities.
Section 6. [NEW MATERIAL] DATE PAYMENT DUE.--The tax imposed by the Soft Drink Tax Act shall be paid on or before the twenty-fifth day of the month following the month in which the taxable event occurs.
Section 7. [NEW MATERIAL] REFUND OR CREDIT OF TAX.--The department shall allow a claim for refund or credit as provided in Sections 7-1-26 and 7-1-29 NMSA 1978 for the tax imposed by the Soft Drink Tax Act and paid on soft drinks or soft drink syrup or powder destroyed in shipment, spoiled or otherwise damaged so as to be unfit for sale or consumption upon submission of proof satisfactory to the department of such destruction, spoilage or damage.
Section 8. [NEW MATERIAL] INTERPRETATION OF ACT--ADMINISTRATION AND ENFORCEMENT OF TAX.--
A. The department shall interpret the provisions of the Soft Drink Tax Act.
B. The department shall administer and enforce the collection of the soft drink tax, and the Tax Administration Act applies to the administration and enforcement of the tax.
Section 9. [NEW MATERIAL] SOFT DRINK MEDICAID FUND CREATED.--The "soft drink medicaid fund" is created in the state treasury. The fund and income produced by the fund are appropriated to the human services department for expenditure in fiscal year 2006 and subsequent fiscal years on the medicaid program and shall be held and used solely for the purpose of supporting the state medicaid program and shall not be used to pay general or special obligations or debts of the state or to fund other programs. The fund shall be administered by the human services department and shall be expended upon warrants issued by the secretary of finance and administration upon vouchers signed by the secretary of human services.
Section 10. A new section of the Tax Administration Act is enacted to read:
"[NEW MATERIAL] DISTRIBUTIONS--SOFT DRINK TAX.--Pursuant to the provisions of Section 7-1-6.1 NMSA 1978:
A. ninety percent of the net receipts from the soft drink tax shall be distributed to the soft drink medicaid fund and invested by the state treasurer as general fund revenues are invested;
B. four percent of the net receipts from the soft drink tax shall be retained by the taxation and revenue department to defray the costs of administering the provisions of the Soft Drink Tax Act;
C. three percent of the net receipts from the soft drink tax shall be distributed to the department of health for state obesity prevention and awareness programs;
D. two percent of the net receipts from the soft drink tax shall be distributed to the public education department for public school wellness education initiatives; and
E. one percent of the net receipts from the soft drink tax shall be distributed to the public education department for grants to public schools that do not permit sales of soft drinks to students on campus; provided that the public education department shall not make a grant to a public school that exceeds three dollars ($3.00) per elementary school student, six dollars ($6.00) per middle school student or twelve dollars ($12.00) per high school student attending that public school."
Section 11. EFFECTIVE DATE.--The effective date of the provisions of this act is July 1, 2005.
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