1. Businesses
  2. Tax Decisions & Orders
  3. Long John Silver’s, Inc.

Long John Silver’s, Inc.



TP received a 5% or receipts royalty payment and 4% of receipts advertising fee from its NM franchisees upon which the department assessed gross receipts tax. TP argued that as an out-of-state corporation, it was neither engaged in business in NM nor was there sufficient nexus to impose tax. In the alternative, the TP argued that the royalty fee and advertising fee was imposed for services performed out-of-state. Held that entire amount of franchise fees represented payment for the leasing of TP’s intangible property in NM and was therefore subject to gross receipts tax. Protest denied.