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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0005|     
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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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0004|     credit claimed shall not exceed one hundred fifty dollars
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0005|     ($150) per exemption allowable for federal income tax purposes
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0006|     for each individual included in the return or three hundred
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0007|     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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0022|                                  
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0023|     
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0024|     
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0025|          
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