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.

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

SPONSOR Rawson

DATE TYPED 3-03-2005 HB

SHORT TITLE Armed Forces Member Child Care Gross Receipts SB 1049

ANALYST Taylor

REVENUE

Estimated Revenue

Subsequent

Years Impact

Recurring

or Non-Rec

Fund

Affected

FY05

FY06

($8.0)

($8.0) Recurring State General Fund

($5.0)

($5.0) Recurring Local Governments

(Parenthesis ( ) Indicate Revenue Decreases)

SOURCES OF INFORMATION

LFC Files

SUMMARY

Senate Bill 1049 provides a gross receipts tax deduction for receipts from providing child care

services if the person providing the service is a spouse of members of the U.S. armed forces.

The bill has an effective date of July 1, 2005.

FISCAL IMPLICATIONS

The taxation and revenue department estimates that this bill would reduce state general fund

revenue by $8 thousand dollars and local government funds by $5 thousand.

TRD estimates that there are 11,192 persons on activity duty in New Mexico, and that 53 percent

or 5,920 are married. They used these figures as a basis for estimating the number of child care

services owned by spouses of active service members. The estimated tax base was $200,000.

Applying an average statewide gross receipts tax rate of 6.6 percent, implies a revenue loss of

about $13,000. Sixty percent of this is allocated to the general fund and $5 thousand to local

government funds.

ADMINISTRATIVE IMPLICATIONS

TRD reports that administrative issues are minimal.

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