Coming soon to a retail store near you is the annual New Mexico Gross Receipts Tax Holiday. This year it’s August 5-7, and if you have school-age children, it’s nothing short of a bonanza. For that weekend the state suspends collection of gross receipts tax on sales of qualifying items so you can buy the items tax free. Because many merchants also absorb the tax on a number of non-qualifying items, you are the beneficiary all around.
The tax holiday begins at 12:01 a.m. on August 5, 2016 and concludes on August 7, 2016 at midnight.
During that time the law provides a deduction from gross receipts for retail sales of qualifying tangible personal property; in effect allowing the retailer to sell the items “tax free.”
B-200.18, List of Taxable and Non Taxable Items for New Mexico’s Gross Receipts Tax Holiday contains list divided into categories, but please note that within some categories there is a set dollar maximum. To qualify for the deduction, clothing or shoes must be priced at less than $100 per unit. The price limit for desktop, laptop, tablets or notebook computers is $1,000, and for related computer hardware it is $500. School supplies for use in standard, general-education classrooms must be under $30 per unit. There are items specifically excluded by statute in all categories. Those items are always taxable.
For more specific information on the legislation, definitions, types of sales, (rain checks, exchanges, refunds, gift cards, layaways, Internet, mail order and telephone sales) please see FYI-203,Gross Receipts Tax Holiday.
(News release from the New Mexico Taxation & Revenue Department)
