New Mexico’s Gross Receipts Tax system has always been somewhat confusing. Unlike many states that require businesses to collect a tax on product sales (referred to as a sales tax), New Mexico’s tax applies to the sale of products and services.
On July 1, 2021, rules changed, and most businesses are now required to charge the tax rate in effect at the location where their product or service is delivered. The result of this “destination sourcing” is that New Mexico businesses that deliver services or ship products to multiple locations in the state are responsible for reporting a myriad of different rates and collections.
GRT is not static, and changes can occur twice a year — in January and July. Rates change because the total rate is made up of the sum of rates imposed by the state, counties, municipalities, and special taxing districts. For example, GRT changed statewide in July 2022 after the legislature reduced the state rate, while a change in the Silver City municipal rate that same year affected businesses that delivered products or services to Silver City. Springer residents who use municipal water also saw their rate change.
Before the COVID-19 pandemic altered the way we do business, the New Mexico Tax & Revenue Department offered frequent workshops to help companies meet their GRT reporting requirements. Workshops are now delivered sporadically and via previously recorded Zoom presentations.
Organizations such as WESST and the New Mexico Small Business Development Center Network have stepped in to fill the knowledge gap. The business development organizations offer workshops and consulting to help business owners navigate New Mexico’s tax requirements, especially those related to GRT.
GRT Workshop on the Horizon
WESST, in collaboration with the New Mexico Small Business Development Center in Las Cruces, is hosting an online workshop called Understanding the GRT on Friday, February 3, 2023, from 11:30 am to 12:30 pm. Register here.
Unable to attend? Read the GRT overview on the NM Tax & Rev website, and find a Tax & Rev GRT workshop or Zoom recording here. Specific questions? Schedule an appointment with the department.
Check out the list of all upcoming WESST workshops.