Tax & Accounting Blog

New Mexico Repeals Farm Tax

Indirect Tax, ONESOURCE, Sales and Use Tax May 25, 2011

Thanks to Gov. John Hickenlooper’s signature on House Bill 1005, farm and ranch supplies, including vaccines and pesticides, will be tax exempt in New Mexico as of 1 July 2011. The supplies are currently taxed at a state farm rate of 2.9% plus local taxes. This will reverse a decision made by the New Mexico Legislature made in 2010 to tax this type of supplies.

Opponents of the farm taxes argued that it was especially difficult on farmers near the New Mexico border, who may have crossed into New Mexico to buy supplies. The projected loss in revenue for the state is $3.7 million.