us-nm/stat
NMSA 1978, § 7-29C-1 — Intergovernmental tax credits
A.
Any person who is liable for the payment of the oil and gas severance tax, the oil
and gas conservation tax, the oil and gas emergency school tax or the oil and gas ad
valorem production tax imposed on products severed from Indian tribal land or imposed
on the privilege of severing products from Indian tribal land shall be entitled to a credit to
be computed under this section and to be deducted from the payment of the indicated
taxes with respect to products from qualifying wells. The credit provided by this
subsection may be referred to as the "intergovernmental production tax credit".
B.
Any person who is liable for the payment of the oil and gas production equipment
ad valorem tax imposed on equipment located on Indian tribal land shall be entitled to a
credit to be computed under this section and to be deducted from the payment of the
indicated taxes with respect to equipment at qualifying wells. The credit provided by this
subsection may be referred to as the "intergovernmental production equipment tax
credit".
C.
For the purposes of this section:
(1) "equipment" means wells and nonmobile equipment used at a well in
connection with severance, treatment or storage of well products;
(2) "Indian tribal land" means all land that on March 1, 1995 was within the
exterior boundaries of an Indian reservation or pueblo grant or held in trust by the
United States for an Indian person, nation, tribe or pueblo;
(3) "product" means oil, natural gas or liquid hydrocarbon, individually or in
combination, or carbon dioxide; and
(4) "qualifying well" means a well on Indian tribal land, the actual drilling of
which commenced on or after July 1, 1995.
D.
The intergovernmental production tax credit shall be determined separately for
each calendar month and shall be equal to seventy-five percent of the lesser of:
(1) the aggregate amount of severance, privilege, ad valorem or similar tax in
effect on March 1, 1995 that is imposed by the Indian nation, tribe or pueblo upon the
products severed from qualifying wells or upon the privilege of severing products from
qualifying wells; or
(2) the aggregate amount of the oil and gas severance tax, the oil and gas
conservation tax, the oil and gas emergency school tax and the oil and gas ad valorem
production tax imposed by this state upon the products severed from qualifying wells or
upon the privilege of severing products from qualifying wells.
E.
The intergovernmental production equipment tax credit shall be determined
annually for the equipment at qualifying wells and shall be equal to seventy-five percent
of the lesser of:
(1) the amount of ad valorem or similar tax in effect on March 1, 1995 that is
imposed by the Indian nation, tribe or pueblo upon the equipment for the calendar year;
or
(2) the amount of the oil and gas production equipment ad valorem tax
imposed by this state upon the equipment for the calendar year.
F.
If, after March 1, 1995, an Indian nation, tribe or pueblo increases any
severance, privilege, ad valorem or similar tax applicable to products or equipment to
which the tax credits provided by this section apply, the amount of the
intergovernmental production tax credit for any month to which the increase applies
shall be reduced by the difference between the aggregate amount of tax due to the
Indian nation, tribe or pueblo for the production month and the aggregate amount of tax
that would have been imposed by the terms of the tax or taxes in effect on March 1,
1995, and the intergovernmental production equipment tax credit shall be reduced by
the difference between the aggregate amount of tax due to the Indian nation, tribe or
pueblo for the year and the aggregate amount of tax that would have been imposed for
the year by the terms of the tax or taxes in effect on March 1, 1995.
G.
Notwithstanding any other provision of law to the contrary, the amount of credit
taken and allowed shall be applied proportionately against the amount of oil and gas
severance tax, oil and gas conservation tax, oil and gas emergency school tax, oil and
gas ad valorem production tax and oil and gas production equipment ad valorem tax
due with respect to the products, severance of products or equipment taxed.
H.
The taxation and revenue department shall administer and interpret the
provisions of this section in accordance with the provisions of the Tax Administration Act
[Chapter 7, Article 1 NMSA 1978].
I.
The burden of showing entitlement to a credit authorized by this section is on the
taxpayer claiming it, and he shall furnish to the appropriate tax collecting agency, in the
manner determined by the taxation and revenue department, proof of payment of any
tribal tax on which the credit is based.
Source: official text