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New Mexico

New Mexico

Incentives/Policies for Renewables & Efficiency

Printable Version
Biomass Equipment & Materials Compensating Tax Deduction   

Last DSIRE Review: 07/27/2012
Program Overview:
State: New Mexico
Incentive Type: Sales Tax Incentive
Eligible Renewable/Other Technologies: Landfill Gas, Biomass, Municipal Solid Waste, CHP/Cogeneration, Hydrogen, Anaerobic Digestion, Ethanol, Methanol, Biodiesel, Microturbines
Applicable Sectors: Commercial, Industrial
Amount:100% of value may be deducted for purposes of calculating Compensating Tax due
Maximum Incentive:None
Start Date:6/17/2005
Expiration Date:None specified
Authority 1:
Date Enacted:
Date Effective:
Expiration Date:
NM Stat. ยง 7-9-98
04/05/2005
6/17/2005
None specified
Summary:

In 2005 New Mexico adopted a policy to allow businesses to deduct the value of biomass equipment and biomass materials used for the processing of biopower, biofuels or biobased products in determining the amount of Compensating Tax due.

New Mexico's Compensating Tax is an excise, or "use" tax, which is typically levied on the purchaser of the product or service for using tangible property in the state. The tax applies to imports of factory and office equipment, and other items. The rate is 5.125% on certain property used in New Mexico and 5% on certain services used in New Mexico. Compensating Tax is designed to protect New Mexico businesses from unfair competition from out-of-state business not subject to a sales or gross receipts tax. This biomass Compensating Tax deduction is analogous to a sales tax exemption for renewable energy equipment available in some other states.

Deductions from compensating tax do not have to be reported to the NM Taxation and Revenue Department but records substantiating the deduction should be kept in the taxpayer's records.


 
Contact:
  Information Specialist
New Mexico Taxation & Revenue Department
1100 South St. Francis Drive
Santa Fe, NM 87504
Phone: (505) 827-0700
Web Site: http://www.tax.newmexico.gov
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Disclaimer: The information presented on the DSIRE web site provides an unofficial overview of financial incentives and other policies. It does not constitute professional tax advice or other professional financial guidance, and it should not be used as the only source of information when making purchasing decisions, investment decisions or tax decisions, or when executing other binding agreements. Please refer to the individual contact provided below each summary to verify that a specific financial incentive or other policy applies to your project.

While the DSIRE staff strives to provide the best information possible, the DSIRE staff, the N.C. Solar Center, N.C. State University and the Interstate Renewable Energy Council, Inc. make no representations or warranties, either express or implied, concerning the accuracy, completeness, reliability or suitability of the information. The DSIRE staff, the N.C. Solar Center, N.C. State University and the Interstate Renewable Energy Council, Inc. disclaim all liability of any kind arising out of your use or misuse of the information contained or referenced on DSIRE Web pages.

Copyright 2013 - 2014 North Carolina State University, under NREL Subcontract No. XEU-0-99515-01. Permission granted only for personal or educational use, or for use by or on behalf of the U.S. government. North Carolina State University prohibits the unauthorized display, reproduction, sale, and/or distribution of all or portions of the content of the Database of State Incentives for Renewables and Efficiency (DSIRE) without prior, written consent.