New Mexico Sales
Tax Rate
New Mexico has a 4.88% statewide base sales tax rate. With local district taxes added on top, combined rates can reach as high as 8.94% depending on where a purchase is made.
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4.88% – 8.94%
New Mexico combined sales tax rate for 2026
New Mexico's Gross Receipts Tax (GRT) is legally imposed on the seller, not the buyer, and functions as the state's equivalent of a sales tax. Rates update semi-annually (Jan 1 and Jul 1).
Sources: New Mexico TRD — Gross Receipts Tax Rates. Last verified: August 14, 2026.
New Mexico does not use a conventional retail sales tax system. Instead, the state imposes Gross Receipts Tax, or GRT, on businesses that receive money or other value from taxable sales, leases, licenses and services. The state GRT component is 4.875% in 2026, with county and municipal local-option taxes added based on the transaction location.
Although GRT is legally imposed on the business, businesses commonly pass the cost to customers. When the tax is passed on, New Mexico requires it to be separately stated on the invoice.
Source: New Mexico Gross Receipts Tax Overview
Source: New Mexico Local Option Taxes
What Is the New Mexico Sales Tax Rate in 2026?
For users searching for a New Mexico sales tax rate, the closest equivalent is the Gross Receipts Tax. The state portion is 4.875%, then county and municipal local-option rates can increase the total.
| New Mexico Tax Component | 2026 Treatment |
|---|---|
| State Gross Receipts Tax base | 4.875% |
| County local-option GRT | Varies by county |
| Municipal local-option GRT | Varies by municipality |
| Combined GRT rate | Varies by transaction location |
Because local-option rates vary and can change, businesses should use New Mexico's address-based GRT rate finder for the current location code and total rate.
Source: New Mexico GRT Rate Finder
Why New Mexico Gross Receipts Tax Is Not the Same as Sales Tax
The legal taxpayer for New Mexico GRT is generally the business receiving taxable gross receipts, not the customer.
A business may pass the GRT cost to the buyer, which can make the charge look similar to sales tax on a receipt. However, the legal structure is different from a state where the seller merely collects a tax imposed directly on the retail purchaser.
This distinction matters for contracts, invoices, deductions and tax-inclusive pricing.
How to Calculate New Mexico Gross Receipts Tax
To estimate New Mexico GRT, determine the taxable gross receipts and apply the combined rate for the correct reporting location.
Taxable Gross Receipts × Applicable GRT Rate = Gross Receipts Tax
If a business separately passes GRT to the customer, the business should still report the transaction under New Mexico's gross receipts rules. The correct rate depends on the location code assigned to the transaction.
New Mexico uses destination-based sourcing for many delivered transactions, so the customer's delivery location can affect the applicable rate.
What Receipts Are Generally Subject to New Mexico GRT?
New Mexico GRT has a broader base than many conventional sales taxes because taxable gross receipts can include services as well as sales of property.
- Selling property in New Mexico
- Leasing or licensing property used in New Mexico
- Granting a right to use a franchise in New Mexico
- Performing services in New Mexico
- Certain services performed outside New Mexico when the product of the service is initially used in New Mexico
Specific exemptions and deductions can remove qualifying receipts from the tax base. A business should document the statutory basis for each claimed deduction.
Source: New Mexico Gross Receipts Tax Overview
Common New Mexico GRT Deductions and Exemptions
New Mexico provides statutory exemptions and deductions for specific transactions, but ordinary business expenses are not deductions from gross receipts merely because they reduce business profit.
- Certain sales for resale supported by qualifying documentation
- Certain manufacturing transactions
- Qualifying sales of food by retail food stores
- Specific health-care transactions
- Certain government-related or interstate transactions
- Other deductions expressly authorized by the Gross Receipts and Compensating Tax Act
New Mexico often uses Nontaxable Transaction Certificates or other required evidence to support deductions. Businesses should retain the documentation required for the deduction they claim.
Source: New Mexico FYI-105
New Mexico Local Gross Receipts Tax Rates
New Mexico counties and municipalities can impose local-option GRT in addition to the 4.875% state portion.
The state collects those local-option taxes together with state GRT and redistributes the local portions. A municipality can add its rate on top of the state and county layers.
Rates can change by location and effective period, so businesses should use the current address-based rate tool rather than relying on a statewide average.
Source: New Mexico Local Option Taxes
New Mexico Remote Seller Economic Nexus
A business without physical presence in New Mexico can still have GRT nexus when its taxable New Mexico receipts reach the economic nexus threshold.
New Mexico generally creates economic nexus for a person without physical presence when taxable gross receipts sourced to New Mexico in the previous calendar year are at least $100,000.
The threshold covers taxable receipts from sales, leases, licenses and services described by the state's nexus law. Receipts eligible for an exemption or deduction are not included in taxable gross receipts for this test.
Source: New Mexico Determining Nexus
New Mexico Marketplace Sellers and Providers
Marketplace providers can have New Mexico GRT collection and reporting responsibilities for sales they facilitate.
Marketplace sellers should distinguish facilitated sales from direct sales when determining registration, nexus and reporting obligations. A marketplace transaction does not automatically eliminate every New Mexico tax responsibility for the underlying seller.
What Is New Mexico Compensating Tax?
New Mexico Compensating Tax is the state's use-tax counterpart. It can apply when property, services, licenses or franchises are used in New Mexico after being acquired from an out-of-state person and the transaction would have been subject to GRT if the seller had New Mexico nexus.
The Compensating Tax rate is generally based on where the property or service is used and matches the GRT rate for that location.
| Tax | Who Generally Owes It |
|---|---|
| Gross Receipts Tax | Business receiving taxable gross receipts |
| Compensating Tax | Buyer or user when a qualifying out-of-state transaction was not subject to GRT |
Source: New Mexico Compensating Tax
New Mexico GRT Filing and Payment
New Mexico businesses file Gross Receipts Tax returns through the Taxation and Revenue Department, commonly using the Taxpayer Access Point.
GRT returns and payments are generally due on or before the 25th day of the month following the reporting period. Filing frequency can be monthly, quarterly, semiannual or another assigned basis depending on the taxpayer's account.
Registered taxpayers should file the required return for the assigned period even when the period has zero receipts if the filing requirement remains active.
Frequently Asked Questions
Does New Mexico Have Sales Tax?
New Mexico uses Gross Receipts Tax rather than a conventional retail sales tax. Businesses commonly pass the GRT cost to customers.
What Is the New Mexico GRT State Rate in 2026?
The state portion of Gross Receipts Tax is 4.875%, with local county and municipal rates added where applicable.
Does New Mexico Have Local Sales Tax?
New Mexico local governments can impose local-option Gross Receipts Tax. The combined GRT rate therefore varies by location.
Are Services Taxed in New Mexico?
Many services can be included in taxable gross receipts unless a specific exemption or deduction applies.
What Is the New Mexico Remote Seller Threshold?
A person without physical presence generally has economic nexus when taxable New Mexico gross receipts in the previous calendar year reach at least $100,000.
What Is New Mexico Compensating Tax?
Compensating Tax is similar to a use tax and can apply when taxable property or services are used in New Mexico after an out-of-state purchase that was not subject to GRT.