N.M. Stat. § 7-9-55 (2026)

tax; transaction in interstate commerce.
   A. Receipts from transactions in interstate commerce may be deducted from gross
receipts to the extent that the imposition of the gross receipts tax would be unlawful
under the United States constitution.

   B. Receipts from transactions in interstate commerce may be deducted from
governmental gross receipts.

    C. Receipts from transmitting messages or conversations by radio other than from
one point in this state to another point in this state and receipts from the sale of radio or
television broadcast time when the advertising message is supplied by or on behalf of a
national or regional seller or advertiser not having its principal place of business in or
being incorporated under the laws of this state, may be deducted from gross receipts.
Commissions of advertising agencies from performing services in this state may not be
deducted from gross receipts under this section.

History: 1953 Comp., § 72-16A-14.10, enacted by Laws 1969, ch. 144, § 45; Laws
1986, ch. 20, § 65; Laws 1986, ch. 52, § 2; 1993, ch. 31, § 12.

                                      ANNOTATIONS

Repeals. — Laws 1988, ch. 19, § 5, effective July 1, 1988, repealed Laws 1986, ch. 20,
§ 129 and Laws 1986, ch. 52, § 5, which amended versions of this section which were
to take effect July 1, 1988.

Laws 1988, ch. 19, § 2 repealed and reenacted 7-9-55 NMSA 1978 as amended by
Laws 1986, ch. 20, § 65 and Laws 1986, ch. 52, § 2, effective July 1, 1990; however,
Laws 1990, ch. 27, § 2A repealed Laws 1988, ch. 19, § 2, effective May 16, 1990.

The 1993 amendment, effective July 1, 1993, inserted "governmental gross receipts
tax" in the section heading; inserted the subsection designations A and C; and added
Subsection B.

Constitutionality. — The New Mexico gross receipts tax did not violate the commerce
clause of the United States constitution, as applied to a California corporation which
owned and operated a food and restaurant supply business with a warehouse located in
Texas, and which sold food and other restaurant supplies to restaurants for use in New
Mexico by obtaining orders for deliveries by telephoning the restaurants and taking
down the orders over the phone, then delivering the goods in its own trucks from its
warehouse in Texas to the restaurants in New Mexico. Proficient Food Co. v. N.M.
Taxation & Revenue Dep't, 1988-NMCA-042, 107 N.M. 392, 758 P.2d 806, cert. denied,
107 N.M. 308, 756 P.2d 1203.

All interstate commerce is not per se immune from taxation. Spillers v.
Commissioner of Revenue, 1970-NMCA-097, 82 N.M. 41, 475 P.2d 41, cert. denied, 82
N.M. 81, 475 P.2d 778.

Scope of deduction. — This section permits deduction from gross receipts to the
extent that the imposition of gross receipts tax would be unlawful under the United
States constitution. If imposition of the tax upon the particular gross receipts is
constitutionally lawful then such receipts are not deductible hereunder. Spillers v.
Commissioner of Revenue, 1970-NMCA-097, 82 N.M. 41, 475 P.2d 41, cert. denied, 82
N.M. 81, 475 P.2d 778.

Federal law does not preempt tax assessed on receipts from transportation of
railroad crew members within the state. — Where plaintiff contracted with union
pacific railroad and burlington northern Santa Fe railroad to transport railroad
employees to and from railroad trains both within New Mexico and from New Mexico to
another state, and where the New Mexico taxation and revenue department
(department), after an audit, assessed plaintiff for gross receipts on the revenues from
plaintiff’s service between locations within New Mexico, and where plaintiff filed a
complaint for tax refund claiming that federal law preempts the department from
imposing gross receipts tax on the transportation of passengers traveling in interstate
commerce by motor carrier, the district court did not err in granting the department’s
motion for summary judgment, because Congress, in passing 49 U.S.C. §14505,
intended to address passengers of a motor carrier who were traveling as passengers in
interstate commerce, and plaintiff’s transportation of railroad crew members is not part
of ticketed travel between states and thus the railroad crew members were not
passengers traveling in interstate commerce traveling by motor carrier. Renzenberger,
Inc. v. N.M. Taxation & Revenue Dep’t, 2018-NMCA-010, cert. denied.

Immunity from undue burdens. — To attain immunity a showing must be made of
multiple taxation or the lack of a local taxable incident. Such showing is essential to
classify the tax as one unduly burdensome to interstate commerce. Spillers v.
Commissioner of Revenue, 1970-NMCA-097, 82 N.M. 41, 475 P.2d 41, cert. denied, 82
N.M. 81, 475 P.2d 778.

Multiple taxation. — If compensation received under advertising contracts is not
protected by the commerce clause, then multiple taxation of the receipts would not bring
them within such protection. N.M. Newspapers, Inc. v. Bureau of Revenue, 1971-
NMCA-022, 82 N.M. 436, 483 P.2d 317.
Classification pursuant to constitutional mandate not violative of equal
protection. — Granting a deduction, whether in accordance with statute or
administrative regulations, of gross receipts which are not taxable by the state under the
commerce clause, and denying such deduction with respect to receipts which are
subject to state taxation, although the receipts in each instance are produced by
comparable activities, is a reasonable and proper basis for classification. N.M.
Newspapers, Inc. v. Bureau of Revenue, 1971-NMCA-022, 82 N.M. 436, 483 P.2d 317.

Equal protection. — Imposition of tax upon receipts derived by newspaper from
advertising, while receipts of radio and television broadcasters are not taxed, does not
constitute arbitrary and discriminatory treatment or classification in violation of the equal
protection clauses of the federal and state constitutions. N.M. Newspapers, Inc. v.
Bureau of Revenue, 1971-NMCA-022, 82 N.M. 436, 483 P.2d 317.

Educational materials. — Tax levied on gross receipts from out-of-state sales of
tangible personal property in the nature of reproducible educational materials is an
impermissible burden on commerce. Evco v. Jones, 409 U.S. 91, 93 S. Ct. 349, 34 L.
Ed. 2d 325 (1972).

Interstate telegraph messages. — Employee who transmitted telegraph messages
both interstate and intrastate is allowed to deduct receipts derived from interstate
messages from gross receipts under this section. Ealey v. Bureau of Revenue, 1976-
NMSC-010, 89 N.M. 160, 548 P.2d 440.

Access charges and telephone carriers. — Since the access charge is for the service
of transmitting the telephone signal between the inter-local access and transport areas
carrier's switching center and the local phone customer, such taxation of access charge
receipts is barred by this section. GTE Sw., Inc. v. Taxation & Revenue Dep't, 1992-
NMCA-024, 113 N.M. 610, 830 P.2d 162, cert. denied, 113 N.M. 605, 830 P.2d 157.

Ancillary services and telephone carriers. — Gross receipts tax imposed on receipts
for ancillary services performed for interstate carriers is proper even though these
services are related to the provision of interstate telephone service; the receipts are not
receipts from transmitting messages or conversations by telephone. GTE Sw., Inc. v.
Taxation & Revenue Dep't, 1992-NMCA-024, 113 N.M. 610, 830 P.2d 162, cert. denied,
113 N.M. 605, 830 P.2d 157.

Newspaper advertising. — Assessment of gross receipts tax against receipts of
taxpayer derived from out-of-state advertising published in its newspaper was not
violative of the commerce clause. N.M. Newspapers, Inc. v. Bureau of Revenue, 1971-
NMCA-022, 82 N.M. 436, 483 P.2d 317.

Commissions for booking transportation services. — Imposition of gross receipts
tax upon commissions paid to a resident agent of an interstate carrier of household
goods for initiating or booking interstate transportation of such goods does not violate
the federal constitution, and consequently such receipts are not properly deductible.
Spillers v. Commissioner of Revenue, 1970-NMCA-097, 82 N.M. 41, 475 P.2d 41, cert.
denied, 82 N.M. 81, 475 P.2d 778.

Burden on taxpayer. — Even if multiple taxation could be treated as invoking the
protection of the commerce clause, the taxpayer, nevertheless, would have the burden
of establishing his right to immunity from taxation. N.M. Newspapers, Inc. v. Bureau of
Revenue, 1971-NMCA-022,82 N.M. 436, 483 P.2d 317.

Am. Jur. 2d, A.L.R. and C.J.S. references. — 68 Am. Jur. 2d Sales and Use Taxes §§
35 et seq.