Sales Tax in New Mexico: A Complete Guide for Ecommerce Sellers

New Mexico’s Gross Receipts Tax (GRT) is structurally different from a traditional sales tax, it’s imposed on the seller’s gross receipts rather than collected from the buyer, and it applies broadly to services as well as goods. For remote ecommerce sellers, the GRT functions similarly to a sales tax in practice: determine the applicable combined rate for the delivery address, collect GRT on taxable transactions, and remit to the state. New Mexico is not an SST member, and its service-inclusive tax base makes it particularly relevant for technology companies and SaaS sellers.

Quick reference

Economic nexus

New Mexico’s threshold: $100,000 in gross receipts from New Mexico sales OR 200 or more separate transactions into New Mexico in the current or prior calendar year. Either condition triggers GRT registration.

New Mexico enacted its economic nexus rules effective July 1, 2019.

Physical nexus

Physical presence in New Mexico creates nexus without any threshold:

• Warehouse, office, or storage facility in New Mexico
• Employees, agents, or independent contractors in New Mexico
• Sales representatives in New Mexico

Registration

Register with the New Mexico Taxation and Revenue Department through the Taxpayer Access Point (tap.state.nm.us). Registration is free. New Mexico issues a Combined Reporting System (CRS) identification number.

Tax rates

New Mexico’s GRT is set at a combined state-and-local rate that varies by municipality and county. Unlike most states where the state rate is separate from local rates, New Mexico sets a single combined rate for each location.

Combined rate examples:

• Albuquerque: approximately 7.875%
• Santa Fe: approximately 8.4375%
• Las Cruces: approximately 8.3125%
• Rio Rancho: approximately 7.625%
• Rural areas: as low as 5%

New Mexico provides a GRT rate lookup tool through its Taxation and Revenue Department website. Sellers should use destination-based rates: the rate for the location where the buyer receives the goods or services.

What’s taxable

New Mexico’s GRT applies broadly, almost everything is taxable unless specifically exempted. This is the inverse of most states, where the default is not taxable unless enumerated.

Generally taxable: Tangible personal property, services (most categories), digital products, SaaS, professional services.

Generally exempt:

• Prescription medications
• Most food for human consumption (groceries)
• Agricultural and ranching inputs
• Certain manufacturing receipts
• Interstate commerce (goods for delivery outside New Mexico)

Notable New Mexico rules:

• Services: New Mexico taxes services broadly. Professional services, repair services, installation services, and most other services are subject to GRT unless specifically exempted. This is one of the most service-inclusive tax bases in the US
• SaaS: Taxable in New Mexico under the GRT’s broad service base
• Digital products: Taxable, downloaded software, digital content, and remotely accessed software are all subject to GRT
• Food: Food for home consumption is broadly exempt from GRT

Shipping taxability

Delivery and shipping charges in New Mexico are generally included in gross receipts and subject to GRT when associated with taxable transactions. New Mexico’s GRT base includes the total consideration received, which typically encompasses delivery charges.

Marketplace facilitator rules

New Mexico enacted marketplace facilitator legislation effective July 1, 2019. Qualifying marketplace facilitators collect and remit New Mexico GRT on marketplace-facilitated sales.

Remote sellers with no New Mexico physical nexus whose only New Mexico sales are through marketplace facilitators may not need to separately register. Sellers with New Mexico physical nexus must register regardless.

State-specific notes

GRT is imposed on the seller: Unlike a traditional sales tax collected from the buyer, New Mexico’s GRT is technically a tax on the seller’s gross receipts. Sellers are allowed to pass the GRT through to customers (and most do), but it is not collected on behalf of the state in the same way a sales tax is. The distinction matters primarily for contracts and service agreements — GRT should be stated separately if passed to customers.

Services are the norm, not the exception: In most states, services must be specifically enumerated to be taxable. New Mexico reverses this, services are taxable by default unless specifically exempted. Technology companies, consultants, agencies, and SaaS companies with New Mexico customers should assume their services are taxable and verify exemptions rather than assuming non-taxability.

Destination sourcing for remote sellers: New Mexico uses destination-based sourcing for remote sellers — GRT is based on the location where the buyer receives the goods or services.