NMSA 1978, § 7-9-115 — 7-9-115

Deduction; gross receipts tax; goods and services for the
department of defense related to directed energy and satellites.

# A.

Prior to January 1, 2031, receipts from the sale by a qualified contractor of
qualified research and development services and qualified directed energy and satellite-
related inputs may be deducted from gross receipts when sold pursuant to a contract
with the United States department of defense.

# B.

The purposes of the deduction allowed in this section are to promote new and
sophisticated technology, enhance the viability of directed energy and satellite projects,
attract new projects and employers to New Mexico and increase high-technology
employment opportunities in New Mexico.

# C.

A taxpayer allowed a deduction pursuant to this section shall report the amount
of the deduction separately in a manner required by the department.

# D.

The deduction provided by this section shall be included in the tax expenditure
budget pursuant to Section 7-1-84 NMSA 1978 with an analysis of the effectiveness and
cost of the deduction and whether the deduction is performing the purpose for which it
was created.

# E.

As used in this section:
(1) "directed energy" means a system, including related services, that enables
the use of the frequency spectrum, including radio waves, light and x-rays;
(2) "inputs" means systems, subsystems, components, prototypes and
demonstrators or products and services involving optics, photonics, electronics,
advanced materials, nanoelectromechanical and microelectromechanical systems,
fabrication materials and test evaluation and computer control systems related to
directed energy or satellites;
(3) "qualified contractor" means a person other than an organization
designated as a national laboratory by act of congress or an operator of national
laboratory facilities in New Mexico; provided that the operator may be a qualified
contractor with respect to the operator's receipts not connected with operating the
national laboratory;
(4) "qualified directed energy and satellite-related inputs" means inputs
supplied to the department of defense pursuant to a contract with that department
entered into on or after January 1, 2016;
(5) "qualified research and development services" means research and
development services related to directed energy or satellites provided to the department
of defense pursuant to a contract with that department entered into on or after January
1, 2016; and
(6) "satellite" means composite systems assembled and packaged for use in
space, including launch vehicles and related products and services.