0001| HOUSE BILL 274
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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; ENACTING THE HEALTH PROMOTION TAXES ACT;
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0013| IMPOSING A RETAIL SALES TAX ON CIGARETTES, TOBACCO PRODUCTS AND
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0014| ALCOHOLIC BEVERAGES; MAKING AND CHANGING DISTRIBUTIONS;
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0015| AMENDING, REPEALING AND ENACTING SECTIONS OF THE NMSA 1978.
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0016|
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0017| BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
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0018| Section 1. [NEW MATERIAL] SHORT TITLE.--Sections 1
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0019| through 6 of this act may be cited as the "Health Promotion
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0020| Taxes Act".
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0021| Section 2. [NEW MATERIAL] PURPOSE.--The purpose of the
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0022| Health Promotion Taxes Act is to increase substantially the
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0023| taxation of tobacco and alcoholic beverages to promote the
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0024| health of New Mexicans through reduced use and consumption of
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0025| such products.
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0001| Section 3. [NEW MATERIAL] DEFINITIONS.--As used in the
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0002| Health Promotion Taxes Act:
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0003| A. "alcoholic beverages" means distilled or
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0004| rectified spirits, potable alcohol, brandy, whiskey, rum, gin
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0005| and aromatic bitters or any similar alcoholic beverage,
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0006| including blended or fermented beverages, dilutions or mixtures
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0007| of one or more of the foregoing containing more than one-half of
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0008| one percent alcohol, but excluding medicinal bitters;
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0009| B. "cigarette" means any roll of tobacco or any
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0010| substitute wrapped in paper or any substance other than tobacco;
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0011| C. "department" means the taxation and revenue
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0012| department;
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0013| D. "engaging in business" means carrying on or
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0014| causing to be carried on any activity with the purpose of direct
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0015| or indirect benefit;
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0016| E. "person" means any individual, estate, trust,
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0017| receiver, cooperative association, club, corporation, company,
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0018| firm, partnership, limited liability company, joint venture,
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0019| syndicate or other entity or the state or any political
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0020| subdivision of the state; "person" also includes, to the extent
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0021| permitted by law, any governmental entity;
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0022| F. "price" means the total amount of money or the
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0023| reasonable value or other consideration or both paid to a
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0024| retailer for alcoholic beverages, cigarettes or tobacco
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0025| products;
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0001| G. "retailer" means any person engaging in business
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0002| who sells, offers for sale or possesses for the purpose of
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0003| selling at retail alcoholic beverages, cigarettes or tobacco
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0004| products;
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0005| H. "secretary" means the secretary of taxation and
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0006| revenue or the secretary's designee; and
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0007| I. "tobacco product" means any product, other than
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0008| cigarettes, made from or containing tobacco.
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0009| Section 4. [NEW MATERIAL] IMPOSITION OF CIGARETTE TAX,
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0010| TOBACCO PRODUCTS TAX AND LIQUOR EXCISE TAX--RATES.--
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0011| A. An excise tax is imposed on the sale of
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0012| cigarettes by a retailer at a rate of forty-two and three-tenths
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0013| percent of the price paid for cigarettes upon which the tax
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0014| imposed by this subsection has not been paid. This tax may be
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0015| referred to as the "cigarette tax".
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0016| B. An excise tax is imposed on the sale of tobacco
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0017| products by a retailer at a rate of forty-two and three-tenths
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0018| percent of the price paid for tobacco products upon which the
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0019| tax imposed by this subsection has not been paid. This tax may
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0020| be referred to as the "tobacco products tax".
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0021| C. An excise tax is imposed on the sale of alcoholic
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0022| beverages by a retailer at a rate of eleven and one-half percent
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0023| of the price paid for alcoholic beverages upon which the tax
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0024| imposed by this subsection has not been paid. This tax may be
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0025| referred to as the "liquor excise tax".
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0001| Section 5. [NEW MATERIAL] DATE PAYMENT DUE.--The taxes
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0002| imposed by the Health Promotion Taxes Act shall be paid by the
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0003| retailer on or before the twenty-fifth day of the month
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0004| following the month in which the taxable event occurs.
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0005| Section 6. [NEW MATERIAL] INTERPRETATION OF ACT--ADMINISTRATION AND ENFORCEMENT OF TAX.--
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0006| A. The department shall interpret the provisions of
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0007| the Health Promotion Taxes Act.
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0008| B. The department shall administer and enforce the
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0009| collection of the cigarette tax, the tobacco products tax and
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0010| the liquor excise tax, and the Tax Administration Act applies to
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0011| the administration and enforcement of the taxes.
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0012| Section 7. Section 7-1-6.4 NMSA 1978 (being Laws 1983,
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0013| Chapter 211, Section 9, as amended) is amended to read:
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0014| "7-1-6.4. DISTRIBUTION--MUNICIPALITY FROM GROSS RECEIPTS
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0015| TAX.--
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0016| A. Except as provided in Subsection B of this
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0017| section, a distribution pursuant to Section 7-1-6.1 NMSA 1978
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0018| shall be made to each municipality in an amount, subject to any
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0019| increase or decrease made pursuant to Section 7-1-6.15 NMSA
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0020| 1978, equal to the product of the quotient of [one and two
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hundred twenty-five thousandths] one and forty-four
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0022| hundredths percent divided by the tax rate imposed by Section
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0023| 7-9-4 NMSA 1978 times the net receipts for the month
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0024| attributable to the gross receipts tax from business locations:
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0025| (1) within that municipality;
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0001| (2) on land owned by the state, commonly known
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0002| as the "state fair grounds", within the exterior boundaries of
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0003| that municipality;
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0004| (3) outside the boundaries of any municipality
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0005| on land owned by that municipality; and
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0006| (4) on an Indian reservation or pueblo grant in
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0007| an area that is contiguous to that municipality and in which the
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0008| municipality performs services pursuant to a contract between
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0009| the municipality and the Indian tribe or Indian pueblo if:
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0010| (a) the contract describes an area in
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0011| which the municipality is required to perform services and
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0012| requires the municipality to perform services that are
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0013| substantially the same as the services the municipality performs
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0014| for itself; and
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0015| (b) the governing body of the
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0016| municipality has submitted a copy of the contract to the
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0017| secretary.
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0018| B. If the reduction made by Laws 1991, Chapter 9,
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0019| Section 9 to the distribution under this section impairs the
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0020| ability of a municipality to meet its principal or interest
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0021| payment obligations for revenue bonds outstanding prior to July
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0022| 1, 1991 that are secured by the pledge of all or part of the
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0023| municipality's revenue from the distribution made under this
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0024| section, then the amount distributed pursuant to this section to
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0025| that municipality shall be increased by an amount sufficient to
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0001| meet any required payment, provided that the distribution amount
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0002| does not exceed the amount that would have been due that
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0003| municipality under this section as it was in effect on June 30,
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0004| 1992."
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0005| Section 8. Section 7-1-6.11 NMSA 1978 (being Laws 1983,
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0006| Chapter 211, Section 16, as amended) is amended to read:
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0007| "7-1-6.11. DISTRIBUTIONS OF CIGARETTE TAXES.--
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0008| A. A distribution pursuant to Section 7-1-6.1 NMSA
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0009| 1978 shall be made to the county and municipality recreational
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0010| fund in an amount equal to [four and three-quarters] two
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0011| percent of the net receipts, exclusive of penalties and
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0012| interest, attributable to the cigarette tax.
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0013| B. A distribution pursuant to Section 7-1-6.1 NMSA
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0014| 1978 shall be made to the county and municipal cigarette tax
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0015| fund in an amount equal to [nine and one-half] four percent
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0016| of the net receipts, exclusive of penalties and interest,
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0017| attributable to the cigarette tax.
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0018| C. A distribution pursuant to Section 7-1-6.1 NMSA
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0019| 1978 shall be made to the cancer center at the university of New
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0020| Mexico school of medicine in an amount equal to [four and
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three-quarters] two percent of the net receipts, exclusive of
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0022| penalties and interest, attributable to the cigarette tax.
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0023| D. A distribution pursuant to Section 7-1-6.1 NMSA
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0024| 1978 shall be made to the New Mexico finance authority in an
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0025| amount equal to [seven and one-eighth] three percent of the
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0001| net receipts, exclusive of penalties and interest, attributable
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0002| to the cigarette tax.
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0003| E. A distribution pursuant to Section 7-1-6.1 NMSA
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0004| 1978 shall be made to each county in an amount equal to twelve
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0005| and one-half percent of the net receipts for the month
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0006| attributable to the cigarette tax times a fraction, the
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0007| denominator of which is the total population of the state
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0008| according to the most recent federal decennial census and the
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0009| numerator of which is the population of the county according to
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0010| the most recent federal decennial census."
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0011| Section 9. Section 7-12-17 NMSA 1978 (being Laws 1971,
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0012| Chapter 77, Section 14, as amended) is amended to read:
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0013| "7-12-17. REPORTING REQUIREMENTS--PENALTY.--
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0014| A. Each person who sells cigarettes at retail in
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0015| New Mexico [cigarettes manufactured by that person or who
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receives on consignment or buys cigarettes either directly from
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the manufacturer or from any out-of-state person for resale in
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New Mexico] shall report to the department by the twenty-fifth
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0019| day of each month that person's sales of cigarettes during the
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0020| preceding month in each municipality and within that portion of
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0021| each county outside of the municipalities located in that
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0022| county. The department shall then advise the state treasurer of
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0023| the proportion of the total sales of cigarettes for the month
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0024| within each municipality and within that portion of each county
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0025| outside of municipalities. The reports of such persons shall,
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0001| upon receipt by the department, become public records.
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0002| B. Any person who sells cigarettes at retail in
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0003| New Mexico [cigarettes manufactured by that person or who
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receives on consignment or buys cigarettes for resale in New
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Mexico] who willfully fails to render accurately the reports
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0006| required by this section and any municipal or county officer who
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0007| approves any expenditure or expends funds distributed from the
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0008| county and municipality recreational fund for any purposes other
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0009| than permitted by Section 7-12-15 NMSA 1978 is guilty of a petty
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0010| misdemeanor."
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0011| Section 10. TEMPORARY PROVISION--CREDIT AGAINST TAXES
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0012| DUE.--
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0013| A. A retailer may claim a credit against the
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0014| cigarette tax due under the Health Promotion Taxes Act for
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0015| cigarettes sold at retail on or after July 1, 1996 in an amount
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0016| equal to the tax paid under the Cigarette Tax Act on those
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0017| cigarettes that were stamped pursuant to the Cigarette Tax Act
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0018| and sold at retail on or after July 1, 1996.
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0019| B. A retailer may claim a credit against the tobacco
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0020| products tax due under the Health Promotion Taxes Act for
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0021| tobacco products sold at retail on or after July 1, 1996 in an
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0022| amount equal to the tax paid pursuant to the Tobacco Products
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0023| Tax Act on those tobacco products sold at retail on or after
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0024| July 1, 1996.
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0025| C. A retailer may claim a credit against the liquor
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0001| excise tax due under the Health Promotion Taxes Act for
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0002| alcoholic beverages sold at retail on or after July 1, 1996 in
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0003| an amount equal to the tax paid pursuant to the Liquor Excise
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0004| Tax Act on those alcoholic beverages sold at retail on or after
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0005| July 1, 1996.
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0006| D. The taxation and revenue department shall
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0007| interpret this section and may require evidence satisfactory to
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0008| the department from a retailer claiming a credit pursuant to
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0009| this section that the tax has been paid under the Cigarette Tax
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0010| Act, the Tobacco Products Tax Act or the Liquor Excise Tax Act
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0011| on cigarettes, tobacco products or alcoholic beverages sold at
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0012| retail on or after July 1, 1996.
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0013| Section 11. TEMPORARY PROVISION--CONTINUITY OF ACTIONS.--
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0014| A. All taxes due but unpaid under the Cigarette Tax
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0015| Act, the Tobacco Products Tax Act and the Liquor Excise Tax Act
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0016| remain due until paid or until a final determination is made
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0017| that the taxes are not due.
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0018| B. Any protests, claims for refund, court
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0019| proceedings or other actions ongoing with respect to the
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0020| provisions of the Cigarette Tax Act, the Tobacco Products Tax
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0021| Act and the Liquor Excise Tax Act on the effective date of the
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0022| Health Promotion Taxes Act shall be finally determined with
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0023| respect to the applicable provisions of the Cigarette Tax Act,
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0024| the Tobacco Products Tax Act or the Liquor Excise Tax Act, as
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0025| applicable.
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0001| Section 12. REPEAL.--Sections 7-12-1 through 7-12-13,
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0002| 7-12A-1 through 7-12A-10, 7-17-1, 7-17-2, 7-17-5, 7-17-6
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0003| and 7-17-9 through 7-17-12 NMSA 1978 (being Laws 1971, Chapter
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0004| 77, Sections 1 through 3, Laws 1986, Chapter 13, Sections 3 and
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0005| 4, Laws 1971, Chapter 77, Sections 4 through 13, Laws 1986,
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0006| Chapter 112, Sections 2 through 11, Laws 1966, Chapter 49,
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0007| Sections 1 and 2, Laws 1993, Chapter 65, Section 8, Laws 1984,
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0008| Chapter 85, Section 4, Laws 1966, Chapter 49, Sections 7 and 8,
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0009| Laws 1969, Chapter 80, Section 1 and Laws 1984, Chapter 85,
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0010| Section 8, as amended) are repealed.
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0011| Section 13. EFFECTIVE DATE.--
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0012| A. The effective date of the provisions of Sections
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0013| 1 through 6 and 9 through 12 of this act is July 1, 1996.
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0014| B. The effective date of the provisions of Sections
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0015| 7 and 8 of this act is August 1, 1996.
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0016|
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