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committees of the NM Legislature. The LFC does not assume responsibility for the accuracy of these reports

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F I S C A L I M P A C T R E P O R T

SPONSOR B. Lujan

DATE TYPED 01/26/05 HB 234

SHORT TITLE Nontaxable Transaction Certificate Re-issuance

SB

ANALYST Padilla-Jackson

REVENUE

Estimated Revenue

Subsequent

Years Impact

Recurring

or Non-Rec

Fund

Affected

FY05

FY06

NFI

NFI

NFI

General Fund

NFI

NFI

NFI

Local Governments

(Parenthesis ( ) Indicate Revenue Decreases)

SOURCES OF INFORMATION

LFC Files

Taxation and Revenue Department (TRD)

SUMMARY

Synopsis of Bill

House Bill 234 eliminates certain requirements related to the re-issuance of nontaxable transac-

tion certificates by the Department of Taxation and Revenue. The current statute declares, as of

January 1, 2005, that every nontaxable transaction certificate is void with respect to transactions

after December 31, 2004 and requires the department to issue new certificates each twelve-year

period, beginning January 1, 2005. This bill eliminates those requirements.

This bill carries an emergency clause so the bill’s provisions would take effect upon signature by

the governor.

FISCAL IMPLICATIONS

TRD reports that this bill would not significantly impact revenues.

ADMINISTRATIVE IMPLICATIONS

TRD’s analysis reported the following comment on the administrative implications of the bill:

House Bill 234 -- Page 2

Eliminating the requirement to issue a new series of NTTC’s will result in substantial savings of

administrative cost for the Department. The Department is currently developing computer sys-

tems that will enable the automation of NTTC processing to a substantial extent. This will en-

able closer monitoring of NTTC’s to prevent abuse of the system, which was the original goal of

the requirement to re-issue the paper certificates every 12 years. Thus, the goals of the require-

ment can be met without going through the expense of re-issuing an entire series of certificates.

OTHER SUBSTANTIVE ISSUES

TRD reported the following note: In addition to administrative costs, re-issuance of a new se-

ries of NTTC’s would have imposed substantial compliance costs on taxpayers.

OPJ/lg