The compensating (use) tax is imposed on persons using services in New Mexico that was not initially subject to the gross receipts tax but which, because of the buyer's subsequent use, should have been subject to the use tax.
The use tax is the same rate as your gross receipts tax.
The use tax is also imposed on the privilege of using tangible property in New Mexico acquired or converted to use by the manufacturer in the following instances:
- Property is manufactured by the person using the property in New Mexico
- Property is acquired outside the state in a transaction that would have been subject to the gross receipts tax had it occurred in the state
- Property is acquired as the result of a transaction not giving rise to the payment of tax but which, due to the eventual use of the property, would have required payment of the tax
The user of the property is liable for the tax, but is discharged if the tax was paid to the seller.
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