HOUSE BILL 79
56th legislature - STATE OF NEW MEXICO - second session, 2024
John Block and Stefani Lord and Tanya Mirabal Moya
RELATING TO TAXATION; PROVIDING A PARTIAL GROSS RECEIPTS TAX DEDUCTION FOR THE SALE OF FIREARMS AND AMMUNITION; CREATING A DISTRIBUTION OF THE STATE GROSS RECEIPTS TAX TO HOLD LOCAL GOVERNMENTS HARMLESS FOR THE DEDUCTION.
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] DISTRIBUTION--OFFSET FOR FIREARMS AND AMMUNITION DEDUCTION.--
A. A distribution pursuant to Section 7-1-6.1 NMSA 1978 shall be made to a municipality in an amount, subject to any increase or decrease made pursuant to Section 7-1-6.15 NMSA 1978, equal to the sum of the deduction claimed pursuant to Section 2 of this 2024 act for the month by taxpayers from business locations attributable to the municipality multiplied by the sum of the combined rate of all municipal local option gross receipts taxes in effect in the municipality on January 1, 2024 plus one and two hundred twenty-five thousandths percent.
B. A distribution pursuant to Section 7-1-6.1 NMSA 1978 shall be made to a county in an amount, subject to any increase or decrease made pursuant to Section 7-1-6.15 NMSA 1978, equal to the sum of the total deductions claimed pursuant to Section 2 of this 2024 act for the month by taxpayers from business locations:
(1) within a municipality in the county multiplied by the combined rate of all county local option gross receipts taxes in effect on January 1, 2024 that are imposed in the county; and
(2) in the county but not within a municipality multiplied by the combined rate of all county local option gross receipts taxes in effect on January 1, 2024 that are imposed in the county area not within a municipality.
C. A distribution pursuant to this section may be adjusted for a distribution made to a tax increment development district with respect to a portion of a gross receipts tax increment dedicated by a municipality pursuant to the Tax Increment for Development Act.
D. For the purposes of this section, "business locations attributable to the municipality" means business locations:
(1) within the municipality;
(2) on land owned by the state, commonly known as the "state fairgrounds", within the exterior boundaries of the municipality;
(3) outside the boundaries of the municipality on land owned by the municipality; and
(4) on an Indian reservation or pueblo grant in an area that is contiguous to the municipality and in which the municipality performs services pursuant to a contract between the municipality and the Indian tribe or Indian pueblo if:
(a) the contract describes an area in which the municipality is required to perform services and requires the municipality to perform services that are substantially the same as the services the municipality performs for itself; and
(b) the governing body of the municipality has submitted a copy of the contract to the secretary."
SECTION 2. A new section of the Gross Receipts and Compensating Tax Act is enacted to read:
"[NEW MATERIAL] DEDUCTION--GROSS RECEIPTS--FIREARMS AND AMMUNITION.--
A. Twenty-five percent of receipts from the sale of firearms and ammunition may be deducted from gross receipts.
B. A taxpayer allowed a deduction pursuant to this section shall report the amount of the deduction separately in a manner required by the department.
C. The department shall compile an annual report on the deduction provided by this section that shall include the number of taxpayers that claimed the deduction, the aggregate amount of deductions claimed and any other information necessary to evaluate the effectiveness of the deduction. The department shall present the report to the revenue stabilization and tax policy committee and the legislative finance committee with an analysis of the cost of the deduction.
D. As used in this section:
(1) "ammunition" means ammunition or cartridge cases, primers, bullets or propellent powder designed for use in any firearm; and
(2) "firearm" means a weapon that will or is designed to or may readily be converted to expel a projectile by the action of an explosive and includes the frame or receiver of any such weapon, a firearm muffler or firearm silencer."
SECTION 3. EFFECTIVE DATE.--The effective date of the provisions of this act is July 1, 2024.