New Mexico Administrative Code
Title 3 - TAXATION
Chapter 2 - GROSS RECEIPTS TAXES
Part 114 - EXEMPTION - GROSS RECEIPTS AND COMPENSATING TAX - FUEL
Section 3.2.114.10 - TRANSFER OF FUEL INCIDENTAL TO A SALE OR LEASE

A. The provisions of Section 7-9-26 NMSA 1978 do not apply when the transfer or sale of the fuel is incidental to the sale or lease of a vehicle.

B. Example: X Company leases a truck to Y Company in New Mexico. X furnishes all parts and labor required to maintain and repair the leased vehicle and provides tires, oil and gasoline needed during the lease term. Y pays X a fixed predetermined rental charge for the truck along with the above items. The lease contract requires X to furnish the truck filled with gasoline at the beginning of the lease term and to continue to furnish gasoline during the lease term. X furnishes gasoline to Y only in conjunction with the rental of the truck. Z Company sells to X all the gasoline X requires for the truck it leased to Y. X's total receipts from leasing the truck to Y are subject to the gross receipts tax. No part of X's receipts are exempt from the gross receipts tax, because X's receipts are not receipts from "selling and the use of gasoline". Z's receipts from selling gasoline to X are exempt from the gross receipts tax if the tax imposed by Section 7-13-3 NMSA 1978 or Section 7-16A-3 NMSA 1978 has been paid on that gasoline and not refunded.