NMSA 7-9-115. Deduction; gross receipts tax; goods and services for the
AI-assisted research summary: A qualified contractor may deduct certain Department of Defense receipts before January 1, 2031, and a taxpayer taking the deduction must report the deduction separately as required by the department.
7-9-115. Deduction; gross receipts tax; goods and services for the department of defense related to directed energy and satellites. A. Prior to January 1, 2031, receipts from the sale by a qualified contractor of qualified research and development services and qualified directed energy and satellite- related inputs may be deducted from gross receipts when sold pursuant to a contract with the United States department of defense. B. The purposes of the deduction allowed in this section are to promote new and sophisticated technology, enhance the viability of directed energy and satellite projects, attract new projects and employers to New Mexico and increase high-technology employment opportunities in New Mexico. C. A taxpayer allowed a deduction pursuant to this section shall report the amount of the deduction separately in a manner required by the department. D. The deduction provided by this section shall be included in the tax expenditure budget pursuant to Section 7-1-84 NMSA 1978 with an analysis of the effectiveness and cost of the deduction and whether the deduction is performing the purpose for which it was created. E. As used in this section: (1) "directed energy" means a system, including related services, that enables the use of the frequency spectrum, including radio waves, light and x-rays; (2) "inputs" means systems, subsystems, components, prototypes and demonstrators or products and services involving optics, photonics, electronics, advanced materials, nanoelectromechanical and microelectromechanical systems, fabrication materials and test evaluation and computer control systems related to directed energy or satellites; (3) "qualified contractor" means a person other than an organization designated as a national laboratory by act of congress or an operator of national laboratory facilities in New Mexico; provided that the operator may be a qualified contractor with respect to the operator's receipts not connected with operating the national laboratory; (4) "qualified directed energy and satellite-related inputs" means inputs supplied to the department of defense pursuant to a contract with that department entered into on or after January 1, 2016; (5) "qualified research and development services" means research and development services related to directed energy or satellites provided to the department of defense pursuant to a contract with that department entered into on or after January 1, 2016; and (6) "satellite" means composite systems assembled and packaged for use in space, including launch vehicles and related products and services. History: Laws 2015 (1st S.S.), ch. 2, § 9; 2019, ch. 186, § 1; 2025, ch. 130, § 88.