As used in the Resources Excise Tax Act:
A. “department” means the taxation and revenue department, the secretary of taxation and revenue or any employee of the department exercising authority lawfully delegated to that employee by the secretary;
B. “natural resource” means timber and any product thereof and any metalliferous or nonmetalliferous mineral product, combination or compound thereof, severed in New Mexico but does not include oil, natural gas, liquid hydrocarbon individually or any combination thereof, carbon dioxide, helium or nonhydrocarbon gas;
C. “person” means any individual, estate, trust, receiver, cooperative association, club, corporation, company, firm, partnership, joint venture, syndicate or other entity;
D. “processing” means smelting, leaching, refining, reducing, compounding or otherwise preparing for sale or commercial use any natural resource so that its character or condition is materially changed in mills or plants located in New Mexico;
E. “processor” means any person engaging in the business of processing natural resources that the person owns, or any person who is the owner of natural resources and who has another person perform the processing of such natural resources;
F. “service charge” means the total amount of money or the reasonable value of other consideration received for severing or processing any natural resource by any person who is not the owner of the natural resource. However, if the money received does not represent the value of the severing or processing performed, “service charge” means the reasonable value of the severing or processing performed;
G. “severer” means any person engaging in the business of severing natural resources that the person owns, or any person who is the owner of natural resources and who has another person perform the severing of such natural resources;
H. “severing” means mining, quarrying, extracting, felling or producing any natural resource in New Mexico for sale, profit or commercial use; and
I. “taxable value” means the value after severing or processing, without deduction of any kind other than specified in this subsection, of any natural resource severed or processed in New Mexico. It is presumed, in the absence of preponderant evidence of another value, that the taxable value means the total amount of money or the reasonable value of other consideration received for the severed or processed natural resource. However, if the amount of money received does not represent the value of the severed or processed natural resource or if the severed or processed natural resource is not sold, the taxable value shall be the reasonable value of the severed or processed natural resource. All natural resources severed or processed in New Mexico shall be included in determining taxable value, regardless of the place of sale or the fact that delivery may be made to points outside of New Mexico. If any person shall ship, transmit or transport natural resources out of New Mexico without making sale of them or shall ship, transmit or transport natural resources out of New Mexico in an unfinished condition, the value of the natural resources in the condition in which they existed when shipped, transmitted or transported out of New Mexico and before they enter interstate commerce, without deduction of any kind other than specified in this subsection, shall be the basis for determining the taxable value. Amounts received from selling natural resources, other than metalliferous mineral ores, whether processed or unprocessed, to the United States or any agency or instrumentality thereof, the state of New Mexico or any political subdivision thereof, or to organizations that have demonstrated to the department that they have been granted exemption from the federal income tax by the United States commissioner of internal revenue as organizations described in Section 501 (c) (3) of the United States Internal Revenue Code of 1954, as amended or renumbered, which employ the natural resource in the conduct of functions described in Section 501 (c) (3) and not in the conduct of an unrelated trade or business as defined in Section 513 of the United States Internal Revenue Code of 1954, as amended or renumbered, may be deducted from taxable value. Any royalty or other similar interest, whether payable in cash or in kind, paid to the United States or any agency or instrumentality thereof, or the state of New Mexico or any political subdivision thereof, or any Indian tribe, Indian pueblo or Indian that is a ward of the United States may be deducted from taxable value. In computing taxable value, any owner of natural resources may deduct any service charge on which the service tax imposed by Section 7-25-6 NMSA 1978 is payable.
History: 1953, Comp., § 72-16A-22, enacted by Laws 1966, ch. 48, § 3; 1968, ch. 58, § 1; 1969, ch. 267, § 1; 1970, ch. 14, § 1; 1971, ch. 23, § 1; 1972, ch. 37, § 1; 1977, ch. 249, § 50; 1979, ch. 255, § 1; 1985, ch. 65, § 22; 1986, ch. 20, § 91; 2007, ch. 275, § 3.
ANNOTATIONS
Cross references. — For Sections 501(c)(3) and 513 of the Internal Revenue Code of 1954, see 26 U.S.C. §§ 501(c)(3) and 513, respectively.
The 2007 amendment, effective July 1, 2007, excluded helium and nonhydrocarbon gas in the definition of “natural resource”.
“Severing” includes incidental development work. — The exemption from the gross receipts tax provided by Section 7-9-35 NMSA 1978 applies when severing was taking place as the development work was performed and none of taxpayer’s work was preliminary to or preparatory for severing; receipts from development work, which includes construction, are exempted from the gross receipts tax and taxable under the service tax provided by Section 7-25-6 NMSA 1978 when such construction work is incidental to the severing. Patten v. Bureau of Revenue, 1974-NMCA-051, 86 N.M. 355, 524 P.2d 527.
Highway department owns sand and gravel severed from leased pits. — Highway department is owner of sand and gravel processed or severed from pits it leases from others. J.W. Jones Constr. Co. v. Revenue Div., 1979-NMCA-144, 94 N.M. 39, 607 P.2d 126.
“Taxable value” includes reimbursements for tax increases. — When a severer is reimbursed for the amount of a severance tax increase, it must include the reimbursed amount in “taxable value” in figuring the resources tax. In re Ranchers-Tufco Limestone Project Joint Venture, 1983-NMCA-126, 100 N.M. 632, 674 P.2d 522, cert. denied, 100 N.M. 505, 672 P.2d 1136.
Law reviews. — For comment, “Taxation of the Uranium Industry: An Economic Proposal,” see 7 N.M. L. Rev. 69 (1976-77).