Resources Excise Tax 

The Resources Excise Tax Act consists of three taxes on activities related to natural resources in New Mexico. Natural resources include timber and mineral products but do not include oil, natural gas, liquid hydrocarbons, carbon dioxide, helium or non-hydrocarbon gas.

  • Any severer of natural resources in New Mexico owes resources tax on the taxable value of the severed resources as follows:
  • All natural resources, except potash and molybdenum—three-fourths of one percent (0.75%);
  • Potash, one-half of one percent (0.5%), and
  • Molybdenum, one-eighth of one percent (0.125%)
  • Any processor of natural resources in New Mexico owes processors tax at the following rates on the taxable value of the natural resource:
  • All natural resources except timber, potash, and molybdenum – three-fourths of one percent (0.75%);
  • Timber – three-eighths of one percent (0.375%);
  • Potash – one-eighth of one percent (0.125%), and
  • Molybdenum – one-eighth of one percent (0.125%)

 

A severer or processor of natural resources owned by another person and not otherwise taxed under the Act owes service tax at the same rate that would be imposed on an owner of the natural resources for performing the same function.

The resource excise tax is paid on or before the twenty-fifth (25th) day of the month following the month in which the taxable event occurs.

 

We deposit the revenue from these taxes in the Extraction Taxes Suspense Fund; the balance, after refunds, is transferred monthly to the General Fund.

Contact Information
New Mexico Taxation and Revenue Department
P.O. Box 2308
Santa Fe, NM 87504-2308

For assistance, call (505) 827-0808


Links

Manage your account online
Who Must Register?
RPD-41038, Resource Excise Tax Return Form and Instructions  
Statutory Reference: Look for Chapter 7, Article 25 NMSA 1978 in the New Mexico State Statutes.

Frequently Asked Questions

Q. What is the purpose of the resource excise tax?

Answer:
The resources excise tax (Chapter 7, Article 25) provides revenue for public purposes by levying a tax on the privilege of severing and processing natural resources within New Mexico.

Q. In general, on which natural resources is the resources excise tax imposed?

Answer:
Generally, the resources excise tax is imposed on: timber and any timber product and any metalliferous or non-metalliferous mineral product, combination, or compound severed in New Mexico excepting oil, natural gas, liquid hydrocarbons, and carbon dioxide.

Q. If I file resources excise tax, do I have to file the severance tax?

Answer:
If you file the resources excise tax, you must file a severance tax report. If the taxpayer is not the owner of the natural resource, then the lessee must pay the tax.

Q. What is the definition of “processing’?

Answer:
“Processing” means smelting, leaching, refining, reducing, compounding or otherwise preparing for sale or commercial use any natural resource in such a way that its character or condition is materially changed in mills or plants located in New Mexico.

Q. Can you explain the three sections of the resources excise tax report, RPD-41193?

Answer:
The three sections of the resources excise tax report are:
-      Section A:  “Resources Tax” - complete this section if the entity is the owner of the land where the extracting or felling is taking place;

-      Section B:  “Processors Tax”- applies if the entity owns the land and is processing hard minerals as described in question 4 above; and
 
-      Section C:  “Services Tax” - applies to the entity severing or processing natural resources if it is not the owner of the natural resources. The service charge is the total amount of money or the reasonable value of other consideration received for severing or processing any natural resource.  

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