New Mexico Administrative Code
Title 3 - TAXATION
Chapter 2 - GROSS RECEIPTS TAXES
Part 214 - DEDUCTION - GROSS RECEIPTS TAX - INTRASTATE TRANSPORTATION AND SERVICES IN INTERSTATE COMMERCE
Section 3.2.214.8 - GENERAL EXAMPLES
Current through Register Vol. 35, No. 18, September 24, 2024
A. The deduction provided by Subsections A and B of Section 7-9-56 NMSA 1978 apply to the receipts of persons who are not a party to a single contract for the transportation of property or persons in interstate commerce but who are selling such services to the person who is obligated to furnish the transportation in interstate commerce under the terms of the contract.
B. Example 1: X, a pipe supply house in Durango, Colorado, sells C in Las Cruces, New Mexico, a truckload of pipe. T, a truck line service, regularly transports property from Durango to Albuquerque. B, another truck line service, has New Mexico authority to transport property from Albuquerque to Las Cruces. X ships the pipe under a through bill of lading to Las Cruces with T. T carries the pipe to Albuquerque. At Albuquerque B attaches a tractor to T's trailer and carries the pipe on to Las Cruces. B can deduct the receipts which B receives from hauling the pipe from a point in New Mexico to another point in New Mexico. The pipe is being shipped in interstate commerce under a single contract. T can deduct its receipts from this transaction under the provisions of Section 7-9-56 NMSA 1978.
C. Example 2: H, an employee of a national chain store, is transferred by the company from Los Angeles to Albuquerque. H contracts with B, a moving company, to move H's household goods from Los Angeles to B's warehouse in Albuquerque. H also contracts with B's Albuquerque agent for interim storage and drayage of the goods pending H's location of housing in Albuquerque. The receipts of B's agents from performing the second contract are subject to the gross receipts tax.
D. Example 3: Y orders materials from an out-of-state supplier and the materials are shipped to Albuquerque under a single contract. The materials are stored in Albuquerque and then Y hires X, a local hauler, to take the materials from the place of storage to the job site. X claims receipts from performing this service are deductible under Section 7-9-56 NMSA 1978. X's receipts are not deductible. X's hauling was not under the single contract or tariff for the interstate shipment. The single contract has previously been completed.
