Santa Fe, New Mexico, is renowned for its distinctive fusion of cultures, stunning scenery, and thriving arts scene. However, if you’re a resident or a business owner, you might be concerned about the taxes you’ll have to pay. The Santa Fe gross receipts tax rate is one of the most crucial taxes to take into account.
The current Santa Fe gross receipts tax rate is 8.4375%. Businesses must pay this tax in exchange for the right to operate in the city. All sales of goods or services within the city are subject to the tax, including retail sales, expert services, and rental revenue. Additionally, certain industries, such restaurants and accommodation, have unique gross receipts tax rates.
It’s crucial to remember that the Santa Fe gross receipts tax rate is different from the sales tax on new cars in New Mexico, even if it can be a burden for some companies. The county where a new car is purchased determines the sales tax that will be applied. The current Santa Fe County sales tax rate for a new vehicle is 6.25%.
A common question is whether the sales tax and the gross receipts tax in New Mexico are the same. No, is the response. Sales tax is levied on the sale of products and services, whereas the gross receipts tax is levied on companies for the right to conduct business in the state. While the gross receipts tax is the same across the state, the sales tax rate differs based on the county where the purchase is made.
How then do you calculate sales tax? You’ll need to know the county’s sales tax rate in order to determine the sales tax due on a purchase. Once you have that knowledge, you can calculate the amount of sales tax due by multiplying the purchase price by the applicable sales tax rate.
Finally, it’s important to remember that some things are tax-free in New Mexico. These consist of supplies, pharmaceuticals, and medical equipment. A deduction for the cost of products sold is one of the several exclusions and deductions that are accessible to businesses.
In conclusion, Santa Fe, New Mexico now has a gross receipts tax rate of 8.4375%. All sales of products or services within the city are subject to this tax, which is placed on companies as compensation for the right to conduct business there. In Santa Fe County, the current sales tax rate is 6.25%. The sales tax is different from the gross receipts tax, and in order to determine the sales tax due on a purchase, you must first know the county’s sales tax rate. Last but not least, New Mexico has a few tax-free items as well as a few business-friendly exemptions and deductions.