ABQ reports 4% bump in gross receipts revenue
Sanchez: A ‘light at the end of the tunnel’ for city’s stalled economy
Albuquerque’s gross receipts tax revenue from business activity during the first quarter of the year rose to $94.9 million, a 4 percent increase compared to the same time last year, according to New Mexico Taxation and Revenue Department figures.
In May alone, the city received a $35 million check from the department resulting from March business activity, an increase of 6.8 percent from last year.
The department distributes tax collections two months after the business activity month.
“We are up from last year,” City Council President Ken Sanchez said. “Based on projected revenues in the budget, we’re still running behind, but I think it’s a real asset to the community as a lot of this money, especially the tax increase, will be going to public safety.
“The GRT has been a challenge over the last several years, especially dealing with the recession,” he said. “We’ve been in the negative for so many years, it’s good to see there’s light at the end of the tunnel.”
That optimism includes a coming tax hike.
The City Council in March approved and Mayor Tim Keller signed legislation to raise the city’s gross receipts tax rate by three-eighths of a percentage point. It takes effect July 1.
Councilors also approved an amendment that stipulates no less than 60 percent of the revenue generated by the increase go toward “the city’s public safety budget goal priorities.”
Separately, Bernalillo County continues to benefit from its own tax increase, which went into effect last July.
The county has received about $49.9 million from first-quarter business activity receipts, an increase of about 23.9 percent compared with a year earlier.
Gross receipts tax revenue is the total amount of money or value of other consideration received from selling property, leasing or licensing property, granting a right to use a franchise, performing services and selling research and development services performed outside New Mexico, the product of which is initially used in New Mexico.
Although the gross receipts tax is imposed on businesses, according to the Taxation and Revenue Department, it is common for a business to pass the GRT on to the purchaser either by separately stating it on the invoice or by combining the tax with the selling price.