2021 New Mexico Statutes
Chapter 3 - Municipalities
Article 38 - Licenses and Taxes
Section 3-38-15 - Authorization of tax; limitations on use of proceeds.

Universal Citation: NM Stat § 3-38-15 (2021)

A. A municipality may impose by ordinance an occupancy tax for revenues on lodging within the municipality, and the board of county commissioners of a county may impose by ordinance an occupancy tax for revenues on lodging within that part of the county outside of the incorporated limits of a municipality.

B. The occupancy tax shall not exceed five percent of the gross taxable rent.

C. Every vendor who is furnishing any lodgings within a municipality or county is exercising a taxable privilege.

D. The following portions of the proceeds from the occupancy tax that are collected based on the first thirty days a vendee rents lodgings in taxable premises shall be used only for advertising, publicizing and promoting tourist-related facilities and attractions and tourist-related events:

(1) if the municipality or county imposes an occupancy tax of no more than two percent, not less than one-fourth of the proceeds shall be used for those purposes;

(2) if the occupancy tax imposed is more than two percent and the municipality is not located in a class A county or the county is not a class A county, not less than one-half of the proceeds from the first three percent of the occupancy tax and not less than one-fourth of the proceeds from the occupancy tax in excess of three percent shall be used for those purposes; and

(3) if the occupancy tax imposed is more than two percent and the municipality is located in a class A county or the county is a class A county, not less than one-half of the proceeds from the occupancy tax shall be used for those purposes.

E. The proceeds from the occupancy tax that are collected based on the first thirty days a vendee rents lodgings in taxable premises in excess of the amount required to be used for advertising, publicizing and promoting tourist-related facilities and attractions and tourist-related events may be used for any purpose authorized in Section 3-38-21 NMSA 1978.

F. The proceeds from the occupancy tax that are required to be used to advertise, publicize and promote tourist-related facilities and attractions and tourist-related events shall be used within two years of the close of the fiscal year in which they were collected and shall not be accumulated beyond that date or used for any other purpose.

G. Notwithstanding the provisions of Paragraph (2) of Subsection D of this section, any use by a municipality or county of occupancy tax proceeds on January 1, 1996 may continue to be so used after July 1, 1996 in accordance with the provisions of this section and Section 3-38-21 NMSA 1978 as they were in effect prior to July 1, 1996; provided, any change in the use of those occupancy tax proceeds after July 1, 1996 is subject to the limitations of that paragraph.

H. Notwithstanding the provisions of Paragraph (2) of Subsection D of this section, the payment of principal and interest on outstanding bonds issued prior to January 1, 1996 pursuant to Section 3-38-23 or 3-38-24 NMSA 1978 shall be made in accordance with the retirement schedules of the bonds established at the time of issuance. The amount of expenditures required under Paragraph (2) of Subsection D of this section shall be reduced each year, if necessary, to make the required payments of principal and interest of all outstanding bonds issued prior to January 1, 1996.

History: 1953 Comp., § 14-37-16, enacted by Laws 1969, ch. 199, § 3; 1976 (S.S.), ch. 34, § 1; 1977, ch. 294, § 1; 1983, ch. 207, § 1; 1987, ch. 9, § 1; 1996, ch. 58, § 3; 2020, ch. 19, § 3.

ANNOTATIONS

Cross references. — For requirements of occupancy tax quarterly reports, see 6-6-4.1 NMSA 1978.

The 2020 amendment, effective July 1, 2020, changed the allowable uses of occupancy tax revenues; in Subsection D, in the introductory clause, after "occupancy tax", added "that are collected based on the first thirty days a vendee rents lodgings in taxable premises", after "facilities and attractions and", added "tourist-related", in Paragraphs D(2) and (3), added "occupancy" preceding each occurrence of "tax"; in Subsection E, after "occupancy tax", added "that are collected based on the first thirty days a vendee rents lodgings in taxable premises", and after "facilities and attractions and", added "tourist-related"; in Subsection F, after "facilities and attractions and", added "tourist-related"; and in Subsection G, added "occupancy" preceding "tax".

The 1996 amendment, effective July 1, 1996, rewrote Subsections D and E, added Subsections F and G, redesignated former Subsection F as Subsection H, and in Subsection H, substituted "Paragraph (2) of Subsection D" for "of Subsection E" near the beginning of the first and second sentences and substituted "January 1, 1996" for "July 1, 1977" near the middle of the first sentence and at the end of the second sentence.

The 1987 amendment, effective June 19, 1987, substituted "five percent" for "three percent" and deleted the exception relating to certain municipalities in Subsection B, inserted "derived from the first three percent" after "proceeds" in the first sentence in Subsection E and added the last sentence in Subsection E.

Am. Jur. 2d, A.L.R. and C.J.S. references. — 71 Am. Jur. 2d State and Local Taxation §§ 1 to 8, 68 to 81, 86 to 91.

64 C.J.S. Municipal Corporations §§ 1978 to 1984.

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