N.M. businesses missed out on tax break but can still amend their returns
La Sirenta ABQ taco truck parked at Gravity Bound Brewing in downtown Albuquerque. (Photo by Marisa Demarco/Source NM)
Officials in charge of New Mexico’s tax policy said on Thursday, Sept. 2, that they expected more businesses to claim a tax break that was created in response to the COVID-19 pandemic.
Stephanie Schardin Clarke and Mark Chaiken of the New Mexico Taxation and Revenue Department updated lawmakers on new parts of the tax law that created a “tax holiday” for restaurants, bars and food trucks.
Senate Bill 1 passed in the 2021 legislative session and allowed those businesses to collect gross receipts tax on food receipts but to deduct all receipts and keep the tax that was collected. It was limited to the period between March 1 and June 30, 2021.
“Also, they were allowed to simply not collect the tax,” Clarke said. “TRD encouraged them to collect and keep it, and that was the point of the bill, to get money into the pockets of restaurant and bar owners.”
Legislative analysts expected the bill to result in $90.3 million in tax relief for business owners, but only 3,636 tax returns actually claimed the deduction, resulting in $50.5 million in tax relief, according to the department.
Department officials met with the New Mexico Restaurant Association and asked them to contact their members, and they promoted the tax benefit through social media, Chaiken said. Business owners who may qualify for the tax refund could still file an amended return that claims the tax benefit.
“There is no sunset clause,” Chaiken said.
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