Bill > HB325

This bill creates new tax deductions to incentivize residential housing construction in New Mexico by allowing businesses to deduct gross receipts taxes for selling labor during new residential housing construction and for sales of new residential housing. Specifically, businesses can deduct up to $125,000 in a twelve-month period from selling new residential housing (or $75,000 for housing intended for lease), and can also deduct receipts from labor incurred during construction, with some important restrictions. Businesses cannot claim both deductions simultaneously, and deductions are not allowed for renovation or remodeling. The bill also includes a "hold harmless" provision that ensures municipalities and counties receive distributions to compensate for the lost tax revenue, calculated based on the deductions claimed and local tax rates. These deductions will be tracked in the state's tax expenditure budget, and the provisions will take effect on July 1, 2025. The bill defines "residential housing" as including single-family residences, town houses, condominiums, and apartment buildings, aiming to support various types of housing development.

Business and Industry

https://www.nmlegis.gov/Legislation/Legislation?chamber=H&legtype=B&legno=325&year=25