Opinion No. 69-68
June 23, 1969
TO: William Gallagher, Jr., Industrial Development Representative, Department of Development, Santa Fe, New Mexico 87501
QUESTIONS
QUESTIONS
1. Is a company liable for the New Mexico ad valorem tax on the value of components brought into New Mexico from another state, processed into a finished product here, and then shipped to a customer outside the state?
2. Is a company liable for the New Mexico ad valorem tax on the value of components brought into New Mexico from another state, processed into a finished product here, and then shipped to another division of the same company located outside the state?
CONCLUSIONS
1. No.
2. No.
OPINION
{*103} ANALYSIS
We shall consider both questions together. The applicable statute provides:
"72-2-1.1. Place of listing and assessment. -- Personal property which is moving interstate commerce through or over the territory of New Mexico or which was consigned to a warehouse or factory within New Mexico from outside the state, for storage, manufacturing processing, or fabricating in transit to a final destination, whether specified when transportation begins or afterwards, which is also outside the state, shall be deemed not to have acquired a situs in New Mexico for purposes of ad valorem taxation." (Emphasis supplied.)
It is our opinion that the broad language of this statute exempts components brought into New Mexico from out of state, processed into a finished product and then shipped out of state, from the New Mexico ad valorem tax. The statute provides the exemption whether the goods are shipped to an out-of-state customer or to another division of the same company located outside New Mexico.