Do contractors charge sales tax in New Mexico?
New Mexico does not run an ordinary sales tax on contractors. It taxes the contractor's own GROSS RECEIPTS, and the charge is called Gross Receipts Tax. It is a tax on the business, not a tax collected from the customer, so it applies to the whole job — including amounts a contractor recharges "at cost", such as a permit fee. New Mexico also has county, city or special-district rates on top of the state rate, so the rate depends on where the job site is, not where the contractor is based. Source: NMSA 1978 §7-9-4 (gross receipts tax on receipts from performing services and selling property in New Mexico).
| What | New Mexico |
|---|---|
| Contractor’s default role | Gross receipts (Gross Receipts Tax) |
| What the charge is called | Gross Receipts Tax |
| Local rates on top | Yes — sourced to the job site |
| Capital improvement exempt to the customer | No |
Notes
GRT is levied on the CONTRACTOR's receipts and is customarily passed through as a separate line. Construction services and construction materials can be deducted by the buyer under §7-9-52 with a Type 6 NTTC — the certificate is what makes it deductible, not the nature of the work.
Source
NMSA 1978 §7-9-4 (gross receipts tax on receipts from performing services and selling property in New Mexico). — last checked 2026-09-15.
This is a summary of a state’s published guidance, not tax or legal advice. Rates and rules change, local jurisdictions add their own, and the treatment of a specific job depends on the contract and the work. Check the citation and speak to a CPA or a state tax adviser before relying on it.
How Seayora uses this rule
Seayora resolves this rule on every invoice a contractor raises — per line, from the job site’s own address — and prints the rate, the jurisdiction and this citation on the document itself, so the estimate a customer accepts is the invoice they are billed. Where the rule is more nuanced than a single answer, Seayora refuses to guess a total rather than quoting a confident wrong one.
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The same question in other states
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