New Mexico Administrative Code
Title 3 - TAXATION
Chapter 16 - MOTOR VEHICLE FUEL TAXES
Part 11 - CLAIM FOR REFUND OR CREDIT OF GASOLINE TAX PAID ON GASOLINE DESTROYED BY FIRE, ACCIDENT OR ACTS OF GOD BEFORE RETAIL SALE
Section 3.16.11.9 - ACCIDENT

(1) X is a distributor. X's driver while delivering to a service station negligently dumps diesel fuel into the gasoline storage tank (Tank A) and gasoline into the diesel fuel storage tank (Tank B). Each tank is nearly full. In order to return the station to operation, X pumps both tanks dry and dumps the resulting mixture into another tank (Tank C) which contains a small amount of gasoline. In this situation, the gasoline dumped into Tank B and the gasoline in Tank A into which diesel fuel was dumped are destroyed, because each becomes a mixture which does not satisfy the definition contained in Subsection H of Section 7-13-2 NMSA 1978. All this gasoline was destroyed by accident within the meaning of Section 3.16.11.9 NMAC, and X may obtain a refund for gasoline tax paid on the gasoline dumped into Tank B and the gasoline in Tank A upon submission of satisfactory proof. The gasoline in Tank C was also destroyed within the meaning of Section 3.16.11.7 NMAC. However, the gasoline in Tank C was not destroyed by accident because X knew there was some gasoline in the tank and knew it would be destroyed when the diesel fuel and gasoline mixture was dumped into it. X will not be granted a refund for gasoline tax paid on the gasoline in Tank C.

(2) Y is a distributor. An underground pipe develops a leak because of corrosion and some gasoline is destroyed. The department will not grant a refund since corrosion is not an accident within the meaning of Section 7-13-11 NMSA 1978.