0001| SENATE BILL 47
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0002| 43RD LEGISLATURE - STATE OF NEW MEXICO - SECOND SESSION, 1998
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0003| INTRODUCED BY
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0004| PHILLIP J. MALOOF
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0006|
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0007|
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0008|
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0009|
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0010| AN ACT
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0011| RELATING TO TAXATION; INCREASING THE PRESCRIPTION DRUG TAX
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0012| CREDIT.
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0013|
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0014| BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
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0015| Section 1. Section 7-2-18.3 NMSA 1978 (being Laws 1994,
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0016| Chapter 5, Section 17) is amended to read:
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0017| "7-2-18.3. CREDIT--PRESCRIPTION DRUGS.--
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0018| A. Except as otherwise provided in Subsection E of
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0019| this section, any resident who files an individual New Mexico
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0020| income tax return and who is not a dependent of another
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0021| individual may claim a credit for state and local gross
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0022| receipts taxes imposed on the receipts from the sale of
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0023| prescription drugs to the resident in New Mexico.
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0024| B. The amount of the credit that may be claimed
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0025| pursuant to this section shall be [three] six percent of
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0001| the taxpayer's actual unreimbursed expenditures for
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0002| prescription drugs purchased in New Mexico during the taxable
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0003| year for which the return is filed [but the amount of the
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credit claimed shall not exceed one hundred fifty dollars
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($150) per exemption allowable for federal income tax purposes
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for each individual included in the return or three hundred
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dollars ($300) per return, whichever is less]. As used in
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0008| this subsection, the term "drugs purchased in New Mexico"
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0009| excludes drugs purchased from any out-of-state source unless
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0010| the New Mexico compensating tax has been paid on the purchase.
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0011| C. The credit provided under this section may be
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0012| deducted from the taxpayer's New Mexico income tax liability
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0013| for the taxable year. If the credit exceeds the taxpayer's
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0014| income tax liability for the taxable year, the excess shall be
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0015| refunded to the taxpayer.
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0016| D. A husband and wife who file separate returns
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0017| for a taxable year in which they could have filed a joint
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0018| return may each claim only one-half of the credit provided
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0019| under this section that would have been allowed on a joint
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0020| return.
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0021| E. No claim for the credit provided under this
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0022| section shall be filed by a resident who was an inmate of a
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0023| public institution for more than six months during the taxable
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0024| year for which the credit could be claimed or who was not
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0025| physically present in New Mexico for at least six months
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0001| during the taxable year for which the credit could be claimed.
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0002| F. As used in this section:
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0003| (1) "dependent" means "dependent" as defined
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0004| by Section 152 of the Internal Revenue Code, but also includes
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0005| a minor child or stepchild of the resident who would be a
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0006| dependent for federal income tax purposes if the public
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0007| assistance contributing to the support of the child or
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0008| stepchild was considered to have been contributed by the
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0009| resident; and
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0010| (2) "prescription drugs" means insulin and
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0011| substances that are:
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0012| (a) dispensed by or under the
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0013| supervision of a licensed pharmacist or other person
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0014| authorized under state law to dispense the substance;
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0015| (b) prescribed for a specified
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0016| individual by a person authorized under state law to prescribe
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0017| the substance; and
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0018| (c) subject to the restrictions on sale
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0019| contained in 21 U.S.C. 353(b)(1)."
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0020| Section 2. APPLICABILITY.--The provisions of this act
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0021| apply to taxable years beginning on or after January 1, 1998.
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