SENATE BILL 129
51st legislature - STATE OF NEW MEXICO - first session, 2013
INTRODUCED BY
George K. Munoz
FOR THE REVENUE STABILIZATION AND TAX POLICY COMMITTEE
AN ACT
RELATING TO TAXATION; CREATING LIMITED-TERM DEDUCTIONS FROM GROSS RECEIPTS AND COMPENSATING TAXES FOR CERTAIN EQUIPMENT PURCHASES FOR PRODUCTION AND PROCESSING OF CHILE.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
SECTION 1. A new section of the Gross Receipts and Compensating Tax Act is enacted to read:
"[NEW MATERIAL] DEDUCTION--COMPENSATING TAX COMPUTATION--EQUIPMENT USED IN THE PRODUCTION AND PROCESSING OF CHILE.--
A. From July 1, 2013 through June 30, 2019, the value of equipment directly related to chile production or chile processing and purchased by a chile producer or processor may be deducted in computing compensating tax due within the twelve-month period beginning with the month that the equipment is purchased.
B. The purpose of this deduction is to encourage the purchase of agricultural equipment to enable greater production and processing of chile.
C. A deduction pursuant to this section shall not be claimed if a deduction pursuant to Section 7-9-77 NMSA 1978 is claimed for the same equipment in the same reporting period.
D. 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 the deduction and any other information that is necessary to determine that the deduction is performing the purpose for which it was enacted.
E. A taxpayer claiming a deduction pursuant to this section shall report the amount deducted separately for each deduction provided in this section and shall 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.
F. As used in this section:
(1) "chile" means any variety of the pepper Capsicum annuum grown in the state;
(2) "chile processing" means changing the raw agricultural product of chile, possibly by combining it with other ingredients, so that value is added before marketing it to consumers;
(3) "chile producer or processor" means a person that derives at least twenty percent of the person's adjusted gross income from the gross receipts from sales of products that are a direct result of chile processing or chile production;
(4) "chile production" means growing or otherwise producing a raw agricultural product from any variety of chile; and
(5) "equipment" means an essential machine, mechanism or tool, or a component or fitting of an essential machine, mechanism or tool, used directly in chile processing or chile production by a purchaser and subject to depreciation for purposes of the Internal Revenue Code of 1986, not including motor vehicles on which the motor vehicle excise tax is paid in lieu of gross receipts tax."
SECTION 2. A new section of the Gross Receipts and Compensating Tax Act is enacted to read:
"[NEW MATERIAL] DEDUCTION--GROSS RECEIPTS--EQUIPMENT USED IN THE PRODUCTION AND PROCESSING OF CHILE.--
A. From July 1, 2013 through June 30, 2019, receipts from the sale of equipment directly related to chile production or chile processing to a chile producer or processor may be deducted from gross receipts within the twelve-month period beginning with the month that the equipment is purchased if the chile producer or processor delivers an appropriate nontaxable transaction certificate to the seller. The department shall promulgate rules for the issuance of a certificate of eligibility for the purposes of claiming a deduction pursuant to this section.
B. The purpose of this deduction is to encourage the purchase of agricultural equipment to enable greater production and processing of chile.
C. A deduction pursuant to this section shall not be claimed if a deduction pursuant to Section 7-9-62 NMSA 1978 is claimed for the same equipment in the same reporting period.
D. 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 the deduction and any other information that is necessary to determine that the deduction is performing the purpose for which it was enacted.
E. A taxpayer claiming a deduction pursuant to this section shall report the amount deducted separately for each deduction provided in this section and shall 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.
F. As used in this section:
(1) "chile" means any variety of the pepper Capsicum annuum grown in the state;
(2) "chile processing" means changing the raw agricultural product of chile, possibly by combining it with other ingredients, so that value is added before marketing it to consumers;
(3) "chile producer or processor" means a person that derives at least twenty percent of the person's adjusted gross income from the gross receipts from sales of products that are a direct result of chile processing or chile production;
(4) "chile production" means growing or otherwise producing a raw agricultural product from any variety of chile; and
(5) "equipment" means an essential machine, mechanism or tool, or a component or fitting of an essential machine, mechanism or tool, used directly in chile processing or chile production by a purchaser and subject to depreciation for purposes of the Internal Revenue Code of 1986, not including motor vehicles on which the motor vehicle excise tax is paid in lieu of gross receipts tax."
- 5 -