SENATE BILL 1045

47th legislature - STATE OF NEW MEXICO - first session, 2005

INTRODUCED BY

Leonard Lee Rawson

AN ACT

RELATING TO TAXATION; REQUIRING BUYERS NOT ENGAGED IN THE CONSTRUCTION BUSINESS TO SUBMIT DOCUMENTATION OF GROSS RECEIPTS TAXES PASSED ON TO AND PAID BY THOSE BUYERS FOR THE SALE OF SERVICES AND MATERIALS USED IN THE CONSTRUCTION OF NEW RESIDENTIAL BUILDINGS; PROHIBITING THE ISSUANCE OF CERTIFICATES OF OCCUPANCY UNDER CERTAIN CIRCUMSTANCES.

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

     Section 1. GROSS RECEIPTS TAX PAYMENT DOCUMENTATION--BUYERS NOT ENGAGED IN THE CONSTRUCTION BUSINESS--SERVICES AND MATERIALS--CERTIFICATES OF OCCUPANCY.--

          A. A person who is not engaged in the construction business and who pays for services and construction materials used in the construction of a new residential building shall submit to the taxation and revenue department in a form prescribed by the department after approval of final inspection by an insuring abstract or title entity, but before issuance of a certificate of occupancy for that building, documentation of:

                (1) the amount paid by the buyer for the services and materials purchased; and

                (2) the amount of gross receipts taxes passed on to the buyer by the seller of the services or construction materials and paid by the buyer.

          B. If, upon review of documentation submitted by a buyer pursuant to Subsection A of this section, the taxation and revenue department determines that a buyer of services and construction materials has not paid the gross receipts tax passed on to the buyer by the seller, the department shall, within two days of receipt of the buyer's submission, report its determination to the political subdivision of the state that is responsible for issuing a certificate of occupancy for that residential building. The political subdivision of the state that receives that determination from the taxation and revenue department shall not issue a certificate of occupancy for that residential building. If the buyer subsequently submits in a form prescribed by the department proof satisfactory to the department that the buyer has paid the seller for the gross receipts tax passed on to the buyer, the department shall notify the political subdivision of that payment within one day of the buyer's submission. Upon receipt of that notification, the political subdivision may issue a certificate of occupancy for the residential building.

     Section 2. EFFECTIVE DATE.--The effective date of the provisions of this act is July 1, 2005.

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