Fiscal impact reports (FIRs) are prepared by the Legislative Finance Committee (LFC) for standing finance

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

if they are used for other purposes.

Current FIRs (in HTML & Adobe PDF formats) are a vailable on the NM Legislative Website (legis.state.nm.us).

Adobe PDF versions include all attachments, whereas HTML versions may not. Previously issued FIRs and

attachments may be obtained from the LFC in Suite 101 of the State Capitol Building North.

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

SPONSOR HTRC

DATE TYPED 03/17/05 HB 930/csHTRC

SHORT TITLE Military Research Gross Receipts

SB

ANALYST Taylor

REVENUE

Estimated Revenue

Subsequent

Years Impact

Recurring

or Non-Rec

Fund

Affected

FY05

FY06

(minimal)

(minimal)

Recurring

General Fund

(minimal)

(minimal)

Recurring

General Fund

(Parenthesis ( ) Indicate Revenue Decreases)

SOURCES OF INFORMATION

LFC Files

Taxation and Revenue Department (discussion with staff; FIR not yet available)

SUMMARY

The House Taxation and Revenue Committee substitute for House Bill 930 provides a gross re-

ceipts deduction for receipts from “transformational acquisition programs” performing research

and development, test and evaluation at New Mexico major and test facility bases. The bill’s

definition of transformational specifies that it applies only to new programs, excluding those

tested before July 1, 2005. The deduction does not apply to receipts from national laboratory

contracts. The deduction exists through 2008 (effectively this is a sunset provision)

FISCAL IMPLICATIONS

The fiscal impact of the new gross receipts tax deduction for “transformational acquisition pro-

grams” is estimated as minimal (probably zero). The minimal fiscal impact is based on the pro-

visions limiting the exemption to new programs, which the department of defense staff have in-

dicated probably would not be sent to New Mexico without the deduction.

BT/rs:lg