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New Mexico Aviation Tax Exemptions Headed to Governor
February 21, 2014
The New Mexico state legislature has passed two measures that are designed to attract increased aviation business and make the state more competitive with its neighbors. The bills have passed both chambers of the legislature and are now awaiting the governor's signature. NBAA applauds the efforts of Members based in New Mexico for their multi-year effort to secure passage of these bills.
Under House Bill 14, both aircraft parts and maintenance labor would be exempt from the gross receipts tax which can range from 5.125 percent to 8.6875 percent, depending on the location of the business. This exemption is important as many states surrounding New Mexico already have parts and labor exemptions, which causes aircraft owners and operators to take their business outside of the state.
"This exemption will bring new aircraft maintenance business to New Mexico and encourage existing facilities to expand their operations," explained Scott O'Brien NBAA's senior manager of finance and tax policy.
The legislature also passed House Bill 24, which would provide an exemption from the gross receipts tax for aircraft more than 10,000 pounds maximum takeoff weight sold to commercial or military carriers. "NBAA thanks members of the New Mexico state legislature for taking action on these bills, and encourages Gov. Martinez to sign both measures into law," said O'Brien.
Business Aviation in New Mexico
Business and general aviation provide the following economic benefits to New Mexico:
- According to the 2009 New Mexico Airport System Plan Update, aviation supports more than 48,000 jobs and $1.3 billion in payroll.
- According to a 2006 Merge Global study, general aviation in New Mexico contributes $761 million to the state’s economy.
- There are 61 public-use airports in the state, serving 5,053 pilots and 3,411 general aviation aircraft.