0001| HOUSE BILL 719
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0002| 42ND LEGISLATURE - STATE OF NEW MEXICO - SECOND SESSION,
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0003| 1996
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0004| INTRODUCED BY
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0005| ROBERT A. PERLS
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0006|
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0007|
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0008|
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0009|
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0010|
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0011| AN ACT
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0012| RELATING TO TAXATION; PROVIDING FOR IMPOSITION AND COLLECTION OF
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0013| CIGARETTE TAXES; PROVIDING FOR AGREEMENTS WITH INDIAN NATIONS,
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0014| TRIBES OR PUEBLOS; AMENDING SECTIONS OF THE NMSA 1978.
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0015|
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0016| BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
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0017| Section 1. Section 7-12-2 NMSA 1978 (being Laws 1971,
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0018| Chapter 77, Section 2, as amended) is amended to read:
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0019| "7-12-2. DEFINITIONS.--As used in the Cigarette Tax Act:
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0020| A. "cigarette" means any roll of tobacco or any
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0021| substitute therefor wrapped in paper or any substance other than
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0022| tobacco;
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0023| B. "person" means any individual, estate, trust,
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0024| receiver, cooperative association, club, corporation, company,
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0025| firm, partnership, joint venture, syndicate or other entity;
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0001| C. "department" means the taxation and revenue
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0002| department, the secretary of taxation and revenue or any
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0003| employee of the department exercising authority lawfully
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0004| delegated to that employee by the secretary;
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0005| D. "secretary" means the secretary of taxation and
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0006| revenue;
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0007| E. "stamp" means any authorized label [which]
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0008| that is issued to cover the tax in multiples of five
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0009| cigarettes and upon which is printed the words "State of New
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0010| Mexico" and "tobacco tax" and [which] that is coated with an
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0011| adhesive to affix the stamp to a package so that the stamp, once
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0012| affixed, cannot be removed without destroying it;
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0013| F. "stamped" means a package or container of
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0014| cigarettes to which a cigarette tax stamp has been affixed as
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0015| provided in the Cigarette Tax Act; [and]
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0016| G. "unstamped" means a package or container of
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0017| cigarettes to which the cigarette tax stamp provided for in the
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0018| Cigarette Tax Act has not been affixed; and
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0019| H. "use or consumption" means the exercise of any
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0020| right or power over cigarettes incident to the ownership other
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0021| than the sale of the cigarettes or the keeping or retention for
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0022| the purpose of sale."
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0023| Section 2. Section 7-12-3 NMSA 1978 (being Laws 1971,
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0024| Chapter 77, Section 3, as amended) is amended to read:
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0025| "7-12-3. EXCISE TAX ON CIGARETTES--RATES.--
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0001| A. For the [privilege of selling, giving or
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consuming] use or consumption of cigarettes in New Mexico,
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0003| there is levied an excise tax at the rate of one and five
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0004| hundredths cents ($.0105) for each cigarette [sold, given]
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0005| used or consumed in this state.
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0006| B. The tax imposed by this section shall be referred
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0007| to as the "cigarette tax".
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0008| C. All taxes paid pursuant to the provisions of the
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0009| Cigarette Tax Act shall be presumed to be direct taxes on the
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0010| retail consumer precollected for the purpose of convenience and
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0011| facility. When the taxes are paid by any other person, the
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0012| payment shall be considered an advance payment and shall be
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0013| added to the price of the cigarettes and recovered from the
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0014| ultimate consumer or user. Any person selling cigarettes at
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0015| retail shall state or separately display in the retail premises,
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0016| or upon the vending machine, a notice of the amount of the tax
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0017| included in the selling price and charged or payable pursuant to
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0018| the Cigarette Tax Act. The provisions of this subsection shall
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0019| not affect the method of collection of the tax as provided by
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0020| the Cigarette Tax Act.
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0021| D. The cigarette tax shall be precollected by the
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0022| persons set forth in Subsection C of Section 7-12-5 NMSA 1978
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0023| through the purchase of stamps as set forth in Section 7-12-7
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0024| NMSA 1978."
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0025| Section 3. Section 7-12-4 NMSA 1978 (being Laws 1971,
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0001| Chapter 77, Section 4, as amended) is amended to read:
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0002| "7-12-4. EXEMPTION.--
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0003| A. Exempted from the cigarette tax [are sales] is
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0004| the use or consumption of cigarettes purchased from:
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0005| (1) [to] the United States or any agency or
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0006| instrumentality thereof or the state of New Mexico or any
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0007| political subdivision thereof; and
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0008| (2) [to] the governing body, or to any
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0009| enrolled tribal member licensed by the governing body, of any
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0010| Indian nation, tribe or pueblo for use or [sale] consumption
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0011| on that reservation or pueblo grant [and
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(3) sales which the state is prohibited from
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taxing by a provision of the United States constitution or the
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constitution of the state of New Mexico].
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0015| B. As used in this section, the term "agency or
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0016| instrumentality" does not include persons who are agents or
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0017| instrumentalities of the United States for a particular purpose
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0018| or only when acting in a particular capacity or corporate
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0019| agencies or instrumentalities."
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0020| Section 4. Section 7-12-5 NMSA 1978 (being Laws 1971,
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0021| Chapter 77, Section 5, as amended) is amended to read:
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0022| "7-12-5. AFFIXING STAMPS--LICENSE FEE.--
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0023| A. All cigarettes [the sale, gift] the use or
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0024| consumption of which is subject to the cigarette tax shall be
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0025| placed in packages or containers to which a stamp may be
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0001| affixed.
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0002| B. Packages or containers to which a stamp is
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0003| required to be affixed and [which] that contain cigarettes
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0004| that are not in multiples of five cigarettes shall have affixed
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0005| a stamp of the next higher multiple of five cigarettes.
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0006| C. Unless the requirements of this section are
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0007| waived pursuant to Section 7-12-6 NMSA 1978, a stamp shall be
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0008| affixed to each package or container of cigarettes [the sale,
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gift] the use or consumption of which is subject to the
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0010| cigarette tax. The stamp shall be affixed by any person who
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0011| sells in New Mexico cigarettes manufactured by that person or
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0012| who receives on consignment or buys unstamped cigarettes for
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0013| sale, gift, use or consumption in New Mexico.
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0014| D. Stamps shall be affixed inside the boundaries of
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0015| New Mexico, unless the department has granted a [license]
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0016| permit allowing a person to affix stamps outside New Mexico.
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0017| The [license] permit fee shall be one-eighth of one percent
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0018| of the gross receipts derived from selling cigarettes stamped
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0019| outside New Mexico. The [license] permit fee imposed by
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0020| this subsection is to be paid on or before the twenty-fifth day
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0021| of the month following the month in which sales of cigarettes
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0022| stamped outside New Mexico are made."
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0023| Section 5. Section 7-12-7 NMSA 1978 (being Laws 1971,
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0024| Chapter 77, Section 7, as amended) is amended to read:
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0025| "7-12-7. SALE OF STAMPS--PRICES.--
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0001| A. The department shall sell stamps to any person
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0002| [who sells in New Mexico cigarettes manufactured by that person
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and to any person who receives on consignment or buys unstamped
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cigarettes for sale, gift or consumption in New Mexico, provided
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such persons are registered with the department under the
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provisions of Section 7-1-12 NMSA 1978] required to affix
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0007| stamps under the provisions of Subsection C of Section 7-12-5
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0008| NMSA 1978, provided such persons are licensed by the department
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0009| to affix stamps pursuant to the provisions of Section 7-12-7.1
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0010| NMSA 1978. Stamps shall be sold at their face value with the
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0011| following discounts:
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0012| (1) four percent less than the face value of
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0013| the first thirty thousand dollars ($30,000) of stamps purchased
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0014| in one calendar month;
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0015| (2) three percent less than the face value of
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0016| the second thirty thousand dollars ($30,000) of stamps purchased
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0017| in one calendar month; and
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0018| (3) two percent less than the face value of all
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0019| stamps purchased in excess of sixty thousand dollars ($60,000)
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0020| in one calendar month.
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0021| B. If the face value of stamps sold in a single sale
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0022| is less than one thousand dollars ($1,000), the discount
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0023| provided for in this section shall not be allowed.
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0024| C. Payment for stamps shall be made on or before the
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0025| twenty-fifth day of the month following the month in which the
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0001| sale of stamps by the department is made."
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0002| Section 6. A new Section 7-12-7.1 NMSA 1978 is enacted to
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0003| read:
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0004| "7-12-7.1. [NEW MATERIAL] LICENSE TO AFFIX STAMPS.--
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0005| A. Every person required to affix stamps under the
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0006| provisions of Subsection C of Section 7-12-5 NMSA 1978 shall
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0007| obtain a license to affix stamps from the secretary.
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0008| B. The secretary shall prescribe by regulation the
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0009| form, content and manner for application for a license to affix
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0010| stamps. The secretary shall prescribe by regulation conditions
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0011| for granting of the license so as to ensure compliance by
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0012| licensees with the provisions of the Cigarette Tax Act.
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0013| C. For failure to comply with the conditions of
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0014| license prescribed by the secretary under the provisions of
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0015| Subsection B of this section the secretary may deny an
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0016| application for or revoke the license to affix stamps. Any
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0017| person whose application for license has been denied or whose
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0018| license has been revoked may protest the denial or revocation of
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0019| license pursuant to the procedures of the Tax Administration
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0020| Act."
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0021| Section 7. Section 7-12-11 NMSA 1978 (being Laws 1971,
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0022| Chapter 77, Section 11) is amended to read:
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0023| "7-12-11. [EXPORT SELLERS] PHYSICAL SEGREGATION OF
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0024| UNSTAMPED CIGARETTES [TO BE EXPORTED].--Any person [selling
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and shipping cigarettes outside New Mexico] licensed to affix
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0001| stamps under Section 7-12-7.1 NMSA 1978 may maintain unstamped
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0002| cigarettes on his premises if the unstamped cigarettes are not
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0003| subject to the Cigarette Tax Act or are to be shipped outside
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0004| the state. [are] All such unstamped cigarettes shall be kept
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0005| in a separate part of his place of business, physically
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0006| segregated from cigarettes to be sold inside New Mexico and
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0007| clearly identified as cigarettes for shipment outside the state
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0008| or for sale, gift, use or consumption not subject to the
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0009| Cigarette Tax Act. If [cigarettes to be sold outside New
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Mexico] such unstamped cigarettes are intermingled with
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0011| stamped cigarettes [to be sold inside New Mexico] they shall
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0012| be stamped [and treated for purposes of] as cigarettes
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0013| subject to the Cigarette Tax Act [as cigarettes to be sold
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inside New Mexico] pursuant to the provisions of Section 7-12-12 NMSA 1978."
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0015| Section 8. Section 7-12-12 NMSA 1978 (being Laws 1971,
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0016| Chapter 77, Section 12, as amended) is amended to read:
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0017| "7-12-12. SHIPMENT OF UNSTAMPED CIGARETTES IN NEW MEXICO.--
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0018| A. The secretary may, by regulation, require and
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0019| prescribe the contents of reports to be filed with the
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0020| department by persons transporting unstamped cigarettes in New
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0021| Mexico.
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0022| B. Every person who transports upon the public
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0023| highways, roads or streets of New Mexico cigarettes not having
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0024| the stamps affixed to the packages or container shall have in
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0025| his actual possession invoices or delivery tickets for such
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0001| cigarettes that shall show the true name and address of the
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0002| consignor or seller, the true name of the consignee or purchaser
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0003| and the quantity and brands of the cigarettes transported. If
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0004| the cigarettes are consigned to or purchased by any person in
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0005| this state, the purchaser or consignee shall be a person who is
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0006| authorized to possess unstamped cigarettes in this state. In
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0007| the absence of such invoices or delivery tickets, or if the name
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0008| or address of the consignee or purchaser is falsified or the
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0009| purchaser or consignee is not a person who is authorized to
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0010| possess unstamped cigarettes in the state, the cigarettes
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0011| transported shall be deemed contraband subject to seizure and
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0012| sale pursuant to the provisions of Subsection C of Section
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0013| 7-12-13 NMSA 1978.
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0014| C. Transportation of cigarettes through New Mexico
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0015| from a point outside this state to a point in some other state
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0016| will not be considered a violation of this section, provided
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0017| that the person so transporting the cigarettes has in his
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0018| possession adequate invoices or delivery tickets that give the
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0019| true name and address of the out-of-state seller or consignor
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0020| and the out-of-state purchaser or consignee.
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0021| D. In any case where the department or its duly
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0022| authorized agent or any state police officer has knowledge or
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0023| reasonable grounds to believe that any vehicle is transporting
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0024| cigarettes in violation of this section, the department, the
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0025| agent or the police officer is authorized to stop the vehicle
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0001| and to inspect it for contraband cigarettes.
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0002| E. For purposes of this section, the term "person
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0003| authorized to possess unstamped cigarettes in this state" means
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0004| a person licensed to affix stamps under the provisions of
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0005| Section 7-12-7.1 NMSA 1978 or a person for whom the requirement
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0006| that stamps be affixed has been waived under the provisions of
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0007| Section 7-12-6 NMSA 1978."
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0008| Section 9. Section 7-12-13 NMSA 1978 (being Laws 1971,
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0009| Chapter 77, Section 13, as amended) is amended to read:
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0010| "7-12-13. PENALTIES.--
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0011| A. Any person selling cigarettes in New Mexico and
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0012| required by the provisions of Section 7-12-10 NMSA 1978 to
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0013| retain invoices who willfully fails to retain such invoices
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0014| shall, upon conviction, be fined not less than twenty-five
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0015| dollars ($25.00) or more than two hundred dollars ($200).
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0016| Jurisdiction over such actions is granted to the magistrate
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0017| courts.
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0018| B. Any person not a manufacturer of cigarettes who
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0019| sells cigarettes in New Mexico without the stamps required by
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0020| Section 7-12-5 NMSA 1978 affixed thereto and without that
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0021| requirement having been waived under Section 7-12-6 NMSA 1978
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0022| shall, upon conviction, be fined not less than one hundred
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0023| dollars ($100) or more than five hundred dollars ($500) or
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0024| imprisoned not more than ninety days in the county jail, or
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0025| both. Jurisdiction over such actions is granted to the
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0001| magistrate courts.
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0002| C. [The department shall seize and sell cigarettes
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which are not stamped as required by the Cigarette Tax Act. The
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sale shall be made pursuant to the provisions of Sections 7-1-41
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through 7-1-49 and 7-1-51 NMSA 1978] In addition to the
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0006| provision of Section 7-12-12 NMSA 1978, any cigarettes that are
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0007| not stamped as required by the Cigarette Tax Act and that are
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0008| not in the possession of a person authorized to possess
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0009| unstamped cigarettes in the state, as that term is used in
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0010| Section 7-12-12 NMSA 1978, are declared to be contraband goods
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0011| that shall be seized by the department or its duly authorized
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0012| agent or by any state police officer when directed by the
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0013| department to do so, without a warrant, and the goods shall be
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0014| offered by the department for sale pursuant to the provisions of
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0015| Sections 7-1-41 through 7-1-49 and 7-1-51 NMSA 1978. The
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0016| department shall collect the amount of cigarette tax due on such
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0017| unstamped cigarettes plus [fifty] one hundred percent
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0018| thereof as penalty, from the proceeds of sale."
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0019| Section 10. Section 7-12-17 NMSA 1978 (being Laws 1971,
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0020| Chapter 77, Section 14, as amended) is amended to read:
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0021| "7-12-17. REPORTING REQUIREMENTS--PENALTY.--
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0022| A. Each person [who sells in New Mexico cigarettes
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manufactured by that person] licensed to affix stamps in New
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0024| Mexico or who receives on consignment or buys cigarettes either
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0025| directly from the manufacturer or from any out-of-state person
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0001| for resale in New Mexico shall report to the department by the
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0002| twenty-fifth day of each month that person's sales of cigarettes
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0003| during the preceding month in each municipality and within that
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0004| portion of each county outside of the municipalities located in
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0005| that county. The department shall then advise the state
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0006| treasurer of the proportion of the total sales of cigarettes for
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0007| the month within each municipality and within that portion of
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0008| each county outside of municipalities. The reports of such
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0009| persons shall, upon receipt by the department, become public
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0010| records.
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0011| B. Any person who sells in New Mexico cigarettes
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0012| manufactured by that person or who receives on consignment or
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0013| buys cigarettes for resale in New Mexico subject to the
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0014| provisions of Subsection A of this section and who willfully
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0015| fails to render accurately the reports required by this section
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0016| and any municipal or county officer who approves any expenditure
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0017| or expends funds distributed from the county and municipality
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0018| recreational fund for any purposes other than permitted by
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0019| Section 7-12-15 NMSA 1978 is guilty of a petty misdemeanor."
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0020| Section 11. A new Section 7-12-18 NMSA 1978 is enacted to
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0021| read:
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0022| "7-12-18. [NEW MATERIAL] PROHIBITION.--The provisions
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0023| of the Cigarette Tax Act shall not apply in any case in which
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0024| New Mexico is prohibited from taxing under the constitution of
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0025| New Mexico or the constitution or laws of the United States."
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0001| Section 12. A new Section 7-12-19 NMSA 1978 is enacted to
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0002| read:
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0003| "7-12-19. [NEW MATERIAL] AGREEMENTS WITH INDIAN TRIBES
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0004| OR PUEBLOS.--
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0005| A. The secretary or his delegate may enter into a
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0006| written agreement with the governing body of any Indian nation,
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0007| tribe or pueblo concerning the administration and enforcement of
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0008| any tax administered under the provisions of the Tax
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0009| Administration Act.
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0010| B. The secretary or his delegate shall refund
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0011| cigarette taxes to the governing body of any Indian nation,
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0012| tribe or pueblo acting as agent for its individual members for
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0013| cigarette taxes collected from pueblo or tribal members for the
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0014| use or consumption of cigarettes purchased upon the pueblo or
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0015| tribal lands."
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0016| Section 13. A new Section 7-12-20 NMSA 1978 is enacted to
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0017| read:
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0018| "7-12-20. [NEW MATERIAL] SEVERABILITY.--If any part or
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0019| application of the Cigarette Tax Act is held invalid, the
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0020| remainder or its application to other situations or persons
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0021| shall not be affected."
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0022| Section 14. EFFECTIVE DATE.--The effective date of the
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0023| provisions of this act is July 1, 1996.
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0024| State of New Mexico
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0025| House of Representatives
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0001|
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0002| FORTY-SECOND LEGISLATURE
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0003| SECOND SESSION, 1996
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0004|
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0005| February 2, l996
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0006|
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0007|
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0008| Mr. Speaker:
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0009|
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0010| Your RULES AND ORDER OF BUSINESS COMMITTEE, to
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0011| whom has been referred
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0012|
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0013| HOUSE BILL 719
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0014|
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0015| has had it under consideration and finds same to be
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0016| GERMANE in accordance with constitutional provisions.
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0017|
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0018| Respectfully submitted,
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0019|
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0020|
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0021|
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0022|
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0023| Barbara A. Perea Casey,
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0024| Chairperson
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0025|
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0001|
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0002| Adopted Not Adopted
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0003|
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0004| (Chief Clerk) (Chief Clerk)
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0005|
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0006| Date
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0007|
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0008| The roll call vote was 8 For 0 Against
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0009| Yes: 8
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0010| Excused: Nicely, Olguin, Pederson, Picraux, Rodella,
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0011| J. G. Taylor, Wallach
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0012| Absent: None
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0013|
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0014| H0719RC1 State of New Mexico
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0015| House of Representatives
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0016|
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0017| FORTY-SECOND LEGISLATURE
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0018| SECOND SESSION, 1996
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0019|
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0020|
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0021| February 11, 1996
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0022|
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0023|
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0024| Mr. Speaker:
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0025|
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0001| Your BUSINESS AND INDUSTRY COMMITTEE, to whom has
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0002| been referred
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0003|
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0004| HOUSE BILL 719
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0005|
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0006| has had it under consideration and reports same with
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0007| recommendation that it DO NOT PASS, and thence referred to
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0008| the TAXATION AND REVENUE COMMITTEE.
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0009|
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0010| Respectfully submitted,
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0011|
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0012|
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0013|
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0014|
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0015| Fred Luna, Chairman
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0016|
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0017|
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0018| Adopted Not Adopted
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0019|
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0020| (Chief Clerk) (Chief Clerk)
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0021|
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0022| Date
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0023|
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0024| The roll call vote was 9 For 0 Against
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0025| Yes: 9
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0001| Excused: None
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0002| Absent: Gubbels, Macko, Varela
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0003|
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0004|
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0005|
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0006| H0719BI1
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