Signed by Governor Bill Richardson

Full Bill Text
Veto Letter

Vote Smart's Synopsis:

Vote to pass a bill that amends the state tax code, including, but not limited to, increasing the gross receipts tax and compensating tax, reducing state distribution to municipalities to offset revenue loss for gross receipts tax deductions for the sale of food at retail food stores, and expanding income tax liability and income tax deductions.

Highlights:

-Increases the tax on gross receipts of individuals engaging in business in New Mexico from 5 to 5.125 percent (Sec. 9). -Repeals the gross receipts tax deduction for the receipts of the sale of food at retail food stores, and establishes a retail food tax credit equaled to 5.125 percent of gross receipts that may be claimed by a retail food store (Secs. 11 & 13). -Repeals the scheduled distribution of revenue to municipalities for revenue loss as a result of the gross receipts tax deduction for the receipts of the sale of food at retail food stores ("hold harmless distribution"), and establishes a new schedule of distribution equal to 1.225 percent of food sales for which the retail food tax credit is claimed for fiscal year 2010-2011 and 1.05 percent for fiscal year 2011-2012 and each fiscal year thereafter (Sec. 5). -Increases the compensating tax from 5 to 5.125 percent, which is imposed on tangible property that was (Sec. 10):

-Manufactured by the individual using property in the state; -Acquired as a result of a transaction with an individual located outside of the state that would have been subject to the gross receipts tax had the property been acquired from an individual in the state; or -Acquired as a result of a transaction that was not initially subject to this tax or the gross receipts tax but should have been as a result of the buyer's subsequent use of the property.

-Expands income tax liability to include state and local income tax and sales tax deductions claimed on an individual's federal tax return (Sec. 7). -Expands income tax deductions for taxable years beginning January 1, 2011 to include the amount of adjusted gross income that represents a refund of state and local income tax and sales taxes that were deducted for federal tax purposes in taxable years beginning January 1, 2010 (Sec. 7). -Expands the Low-Income Comprehensive Tax Rebate by specified amounts depending on income levels, including, but not limited to, increasing the income threshold for an individual to be qualified from $22,000 to $24,000 income level (Sec. 8). -This is a substitute bill sponsored by the Senate Committee on Finance.

Full Bill Text

Vote Smart's Synopsis:

Vote to pass a bill that amends the state tax code, including, but not limited to, increasing the gross receipts tax and compensating tax, reducing state distribution to municipalities to offset revenue loss for gross receipts tax deductions for the sale of food at retail food stores, and expanding income tax liability and income tax deductions.

Highlights:

-Increases the tax on gross receipts of individuals engaging in business in New Mexico from 5 to 5.125 percent (Sec. 9). -Repeals the gross receipts tax deduction for the receipts of the sale of food at retail food stores, and establishes a retail food tax credit equaled to 5.125 percent of gross receipts that may be claimed by a retail food store (Secs. 11 & 13). -Repeals the scheduled distribution of revenue to municipalities for revenue loss as a result of the gross receipts tax deduction for the receipts of the sale of food at retail food stores ("hold harmless distribution"), and establishes a new schedule of distribution equal to 1.225 percent of food sales for which the retail food tax credit is claimed for fiscal year 2010-2011 and 1.05 percent for fiscal year 2011-2012 and each fiscal year thereafter (Sec. 5). -Increases the compensating tax from 5 to 5.125 percent, which is imposed on tangible property that was (Sec. 10):

-Manufactured by the individual using property in the state; -Acquired as a result of a transaction with an individual located outside of the state that would have been subject to the gross receipts tax had the property been acquired from an individual in the state; or -Acquired as a result of a transaction that was not initially subject to this tax or the gross receipts tax but should have been as a result of the buyer's subsequent use of the property.

-Expands income tax liability to include state and local income tax and sales tax deductions claimed on an individual's federal tax return (Sec. 7). -Expands income tax deductions for taxable years beginning January 1, 2011 to include the amount of adjusted gross income that represents a refund of state and local income tax and sales taxes that were deducted for federal tax purposes in taxable years beginning January 1, 2010 (Sec. 7). -Expands the Low-Income Comprehensive Tax Rebate by specified amounts depending on income levels, including, but not limited to, increasing the income threshold for an individual to be qualified from $22,000 to $24,000 income level (Sec. 8). -This is a substitute bill sponsored by the Senate Committee on Finance.

Full Bill Text