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SPONSOR: |
Sandoval |
DATE
TYPED: |
2/6/03 |
HB |
440 |
||
SHORT
TITLE: |
Gross
Receipts Deduction for Podiatrists |
SB |
|
||||
|
ANALYST: |
Smith |
|||||
REVENUE
Estimated Revenue |
Subsequent Years Impact |
Recurring or
Non-Rec |
Fund Affected |
|
FY03 |
FY04 |
|
|
|
|
(55.0) |
(60.0) |
Recurring |
General Fund |
|
(46.0) |
(50.0) |
Recurring |
Local Governments |
|
|
|
|
|
(Parenthesis ( ) Indicate Revenue Decreases)
Responses
Received From
TRD
SUMMARY
Synopsis
of Bill
House Bill 440 amends
Section 7-9-77.1 NMSA 1978 to provide a gross receipts tax deduction for Medicare
receipts of podiatrists licensed pursuant to the provisions of the Podiatry
Act.
The section is further
amended to clarify that medical doctors licensed pursuant to Section 66-6-13
(Licensure by Endorsement) and osteopaths licensed pursuant to Section 66-10-12
(Licensure without Examination) qualify for the current Medicare
deduction.
A minor change in terminology
from “osteopaths” to “osteopathic physicians” is also made.
FISCAL
IMPLICATIONS
The fiscal impact was
derived using the 1997 Census of Healthcare Services in New Mexico, the Department’s
“Analysis of Gross Receipts by Standard Industrial Classification” (Report-80),
“Combined Reporting System-Warrant Distribution Summary” (Report 490B), state
Medicare and Medicaid expenditure data from the Centers for Medicare and
Medicaid Services (CMMS).
Podiatrists are expected to
generate revenues of nearly $12 million and pay approximately $730 thousand in
state and local gross receipts taxes in the absence of this legislation. This
estimate assumes approximately 15% of their receipts are derived from Medicare
payments.
There are no fiscal implications
of the revised licensing provisions.
TRD has provided the following table detailing
the various health care practitioner deductions in current proposals.
Proposals
Affecting Gross Receipts Taxation of Health Providers—2003 Regular Legislative
Session
|
|||
Bill
Number |
Description |
FY 2004 General Fund Impact |
FY 2004 Local Impact |
HB-113 |
Makes
unenforceable any provision in a contract between a healthcare provider and a
health plan that prohibits the provider from passing the gross receipts tax on
to the plan |
No fiscal Impact |
No Fiscal Impact |
HB-163 |
Gross
receipts deduction for physicians licensed pursuant to Medical Practice Act |
(20,700) |
(18,100) |
HB-361 |
Phased
gross receipts deduction for health practitioners’ commercial portion of
managed care contract |
(3,600) |
(3,150) |
HB-440 |
Gross
receipts deduction for podiatrists |
(55) |
(46) |
HB-441 |
Clinical
laboratory gross receipts deduction (SB-213 duplicate) |
(495) |
(425) |
HB-473 |
Gross
receipts exemption for nursing homes (SB-407 duplicate) |
(3,700) |
(3,300) |
|
|
|
|
SB-35 |
Gross
receipts deduction for health practitioners’ commercial portion of managed
care contract (SB-63 duplicate) |
(23,100) |
(12,000) |
SB-63 |
Gross
receipts deduction for health practitioners’ commercial portion of managed
care contract (SB-35 duplicate) |
(23,100) |
(12,000) |
SB-158 |
Gross
receipts deduction for licensed health practitioners and food; local
government offsets; increase state gross receipts tax rate |
(1,500) |
0 |
SB-166 |
Gross
receipts deduction for nursing home Medicare receipts |
(615) |
(415) |
SB-213 |
Clinical
laboratory gross receipts deduction (HB-441 duplicate) |
(495) |
(425) |
SB-407 |
Gross
receipts exemption for nursing homes (HB-473 duplicate) |
(3,700) |
(3,300) |
|
|
|
|
OTHER
SUBSTANTIVE ISSUES
TRD makes the following tax policy arguments:
·
This continues a trend
over the last decade of removing medical and hospital services from the gross
receipts base. A broad base helps to
limit the tax rate, thus cutting the base by an industry this large may shift a
noticeable amount of tax burden to remaining taxpayers.
·
In addition to adding an
element of stability to the gross receipts tax, receipts of health practitioners
grow more quickly than general revenue.
Exempting this sector reduces the state’s ability to generate adequate
revenue from the gross receipts tax.
SS/njw:sb