Originally Posted by
MSPeconomist
A gross receipts tax would be paid by the business entity rather than its customers.
Well, ultimately it is paid by the business. But in New Mexico, it is both common and permitted for the tax to be directly applied to the bills of customers. That money is then transmitted by the business to Taxation & Revenue just a sales tax would be in other states. New Mexico does not impose a sales tax. New Mexico also imposes a compensating tax on users who purchase or use goods that are not subject to the gross receipts tax.
Gross Receipts Tax
Gross receipts are the total amount of money or value of other consideration received from:
•Selling property in New Mexico;
•Leasing or licensing property employed in New Mexico;
•Granting a right to use a franchise employed in New Mexico;
•Performing services in New Mexico, and
•Selling research and development services performed outside New Mexico, the product of which is initially used in New Mexico.
Gross receipts means the total amount of money or other consideration received from the above activities. Although the gross receipts tax is imposed on businesses, it is common for a business to pass the gross receipts tax on to the purchaser either by separately stating it on the invoice or by combining the tax with the selling price.
The gross receipts tax rate varies throughout the state from 5.125% to 8.6875% depending on the location of the business. It varies because the total rate combines rates imposed by the state, counties, and, if applicable, municipalities where the businesses are located. The business pays the total gross receipts tax to the state, which then distributes the counties' and municipalities' portions to them.
http://www.tax.newmexico.gov/all-nm-...50#BlogContent