46th legislature - STATE OF NEW MEXICO - first session, 2003

RELATING TO TAXATION; PROVIDING FOR COOPERATIVE AGREEMENTS WITH THE NAVAJO NATION REGARDING SPECIAL FUELS; PERMITTING TAX CREDITS.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

Section 1. A new section of the Special Fuels Supplier Tax Act is enacted to read:

"[NEW MATERIAL] CREDIT--SPECIAL FUEL EXCISE TAX--TAX PAID TO NAVAJO NATION.--

A. If, on a transaction taking place on land owned by or for the benefit of the Navajo Nation and located within the exterior boundaries of the Navajo Nation, a Navajo Nation tax has been imposed, the amount of the Navajo Nation tax may be credited against tax due to the state or its political subdivisions under the Special Fuels Supplier Tax Act. The amount of the credit shall be equal to the qualifying Navajo Nation tax imposed on the same transaction.

B. A Navajo Nation tax shall:

(1) not unlawfully discriminate among persons or transactions based on membership within the Navajo Nation;

(2) be substantially similar to the tax imposed by Section 7-16A-3 NMSA 1978; and

(3) be subject to a cooperative agreement that has been entered into between the Navajo Nation and the department pursuant to the provisions of the Taxation and Revenue Department Act and that is in effect at the time of the taxable transaction.

C. As used in this section, "Navajo Nation tax" means an excise, privilege or similar tax imposed by the Navajo Nation on special fuels."

Section 2. A new section of the Taxation and Revenue Department Act is enacted to read:

"[NEW MATERIAL] COOPERATIVE AGREEMENTS WITH THE NAVAJO NATION.--

A. The secretary may enter into cooperative agreements with the Navajo Nation for the exchange of information and the reciprocal, joint or common enforcement, administration, collection, remittance and audit of revenues associated with the special fuel excise tax imposed by Section 7-16A-3 NMSA 1978 and a qualifying excise, privilege or similar tax on special fuel imposed by the Navajo Nation.

B. Money collected by the department on behalf of the Navajo Nation in accordance with a cooperative agreement entered into pursuant to this section is not money of the state and shall be collected and disbursed in accordance with the terms of the cooperative agreement, notwithstanding any other provision of law.

C. The secretary is empowered to adopt rules and establish procedures deemed appropriate by the secretary for the collection and disbursement of excise, privilege or similar tax revenue due to the Navajo Nation and for the transfer of special fuel excise taxes collected by the Navajo Nation for the state under the terms of a cooperative agreement entered into pursuant to this section, including procedures for identification of taxpayers or transactions that are subject only to the taxing authority of the Navajo Nation, taxpayers or transactions that are subject only to the taxing authority of the state and taxpayers or transactions that are subject to the taxing authority of both parties' jurisdictions.

D. Nothing in a cooperative agreement entered into pursuant to this section shall be construed:

(1) to authorize the state or the Navajo Nation to tax persons or transactions that federal law prohibits;

(2) to authorize the state courts or the Navajo Nation courts to assert jurisdiction over persons who are not otherwise subject to those courts' jurisdictions;

(3) as affecting any issue of the respective civil or criminal jurisdictions of the state or the Navajo Nation; or

(4) as an assertion or an admission by either the state or the Navajo Nation that the taxes of one have precedence over the taxes of the other when the person or transaction is subject to the taxing authority of both governments.

E. A cooperative agreement entered into pursuant to this section shall be construed solely as an agreement between the two party governments and shall not alter or affect the government-to-government relations between the state and any other Indian nation, tribe or pueblo."

Section 3. EFFECTIVE DATE.--The effective date of the provisions of this act is July 1, 2003.