Section 7-9-3 - Definitions.
7-9-3. Definitions.
As used in the Gross Receipts and Compensating Tax Act:
A. "buying" or "selling" means a transfer of property for consideration or the performance of service for consideration;
B. "department" means the taxation and revenue department, the secretary of taxation and revenue or an employee of the department exercising authority lawfully delegated to that employee by the secretary;
C. "financial corporation" means a savings and loan association or an incorporated savings and loan company, trust company, mortgage banking company, consumer finance company or other financial corporation;
D. "initial use" or "initially used" means the first employment for the intended purpose and does not include the following activities:
(1) observation of tests conducted by the performer of services;
(2) participation in progress reviews, briefings, consultations and conferences conducted by the performer of services;
(3) review of preliminary drafts, drawings and other materials prepared by the performer of the services;
(4) inspection of preliminary prototypes developed by the performer of services; or
(5) similar activities;
E. "leasing" means an arrangement whereby, for a consideration, property is employed for or by any person other than the owner of the property, except that the granting of a license to use property is licensing and is not a lease;
F. "local option gross receipts tax" means a tax authorized to be imposed by a county or municipality upon the taxpayer's gross receipts and required to be collected by the department at the same time and in the same manner as the gross receipts tax; "local option gross receipts tax" includes the taxes imposed pursuant to the Municipal Local Option Gross Receipts Taxes Act [7-19D-1 NMSA 1978], Supplemental Municipal Gross Receipts Tax Act [7-19-10 NMSA 1978], County Local Option Gross Receipts Taxes Act [7-20E-1 NMSA 1978], Local Hospital Gross Receipts Tax Act [7-20C-1 NMSA 1978], County Correctional Facility Gross Receipts Tax Act [7-20F-1 NMSA 1978] and such other acts as may be enacted authorizing counties or municipalities to impose taxes on gross receipts, which taxes are to be collected by the department;
G. "manufactured home" means a movable or portable housing structure for human occupancy that exceeds either a width of eight feet or a length of forty feet constructed to be towed on its own chassis and designed to be installed with or without a permanent foundation;
H. "manufacturing" means combining or processing components or materials to increase their value for sale in the ordinary course of business, but does not include construction;
I. "person" means:
(1) an individual, estate, trust, receiver, cooperative association, club, corporation, company, firm, partnership, limited liability company, limited liability partnership, joint venture, syndicate or other entity, including any gas, water or electric utility owned or operated by a county, municipality or other political subdivision of the state; or
(2) a national, federal, state, Indian or other governmental unit or subdivision, or an agency, department or instrumentality of any of the foregoing;
J. "property" means real property, tangible personal property, licenses other than the licenses of copyrights, trademarks or patents and franchises. Tangible personal property includes electricity and manufactured homes;
K. "research and development services" means an activity engaged in for other persons for consideration, for one or more of the following purposes:
(1) advancing basic knowledge in a recognized field of natural science;
(2) advancing technology in a field of technical endeavor;
(3) developing a new or improved product, process or system with new or improved function, performance, reliability or quality, whether or not the new or improved product, process or system is offered for sale, lease or other transfer;
(4) developing new uses or applications for an existing product, process or system, whether or not the new use or application is offered as the rationale for purchase, lease or other transfer of the product, process or system;
(5) developing analytical or survey activities incorporating technology review, application, trade-off study, modeling, simulation, conceptual design or similar activities, whether or not offered for sale, lease or other transfer; or
(6) designing and developing prototypes or integrating systems incorporating the advances, developments or improvements included in Paragraphs (1) through (5) of this subsection;
L. "secretary" means the secretary of taxation and revenue or the secretary's delegate;
M. "service" means all activities engaged in for other persons for a consideration, which activities involve predominantly the performance of a service as distinguished from selling or leasing property. "Service" includes activities performed by a person for its members or shareholders. In determining what is a service, the intended use, principal objective or ultimate objective of the contracting parties shall not be controlling. "Service" includes construction activities and all tangible personal property that will become an ingredient or component part of a construction project. That tangible personal property retains its character as tangible personal property until it is installed as an ingredient or component part of a construction project in New Mexico. Sales of tangible personal property that will become an ingredient or component part of a construction project to persons engaged in the construction business are sales of tangible personal property; and
N. "use" or "using" includes use, consumption or storage other than storage for subsequent sale in the ordinary course of business or for use solely outside this state.