January 27, 2025
What is the Sales Tax on Clothing in New Mexico: A 2025 Guide for Retailers
Table of contents
What is the Sales Tax on Clothing in New Mexico?
New Mexico applies a Gross Receipts Tax (GRT) on clothing sales, with rates varying by location. Below is a breakdown of key details:
Tax Type | Details |
|---|---|
Tax Applied | Gross Receipts Tax (GRT) is charged to the seller and typically passed on to the consumer. |
Rate Range | GRT rates vary by location, typically between 5% and 9%. |
Taxable Items | All clothing items are subject to GRT unless purchased for resale or under nonprofit exemptions. |
For more general information on New Mexico sales tax, visit Kintsugi's comprehensive guide: New Mexico Sales Tax Guide 2025: A Step-by-Step Guide for Businesses.
Table: 2025 GRT Rates by City
New Mexico applies Gross Receipts Tax (GRT) on clothing sales, with rates varying by location. Sellers must collect and remit GRT to the New Mexico Taxation and Revenue Department, ensuring compliance with state tax laws and meeting the economic nexus criteria.
Below is a breakdown of GRT rates and the corresponding tax amount on a $100 purchase in the state's largest cities.
Location | GRT Rate | Purchase Amount | Tax Charged |
|---|---|---|---|
Albuquerque | 7.875% | $100 | $7.88 |
Las Cruces | 8.3125% | $100 | $8.31 |
Rio Rancho | 7.6875% | $100 | $7.69 |
Santa Fe | 8.4375% | $100 | $8.44 |
Roswell | 7.8333% | $100 | $7.83 |
Farmington | 8.3125% | $100 | $8.31 |
Clovis | 8.1875% | $100 | $8.19 |
Hobbs | 7.5625% | $100 | $7.56 |
Alamogordo | 8.0000% | $100 | $8.00 |
Carlsbad | 7.5625% | $100 | $7.56 |
Gallup | 8.3125% | $100 | $8.31 |
Deming | 8.2500% | $100 | $8.25 |
Los Lunas | 7.8125% | $100 | $7.81 |
Sunland Park | 8.3125% | $100 | $8.31 |
Las Vegas | 8.1875% | $100 | $8.19 |
Notes
GRT rates vary by location, ranging from 7.56% to 8.44% in major cities.
Businesses must collect and remit GRT based on the location of the sale, including taxable services provided.
For city-based, local sales tax rates in New Mexico, visit our New Mexico Local Sales Tax Directory and search for your city.
FAQs
Is clothing taxable in New Mexico?
Yes, clothing is taxable in New Mexico under Gross Receipts Tax (GRT), with rates varying by location, typically between 5% and over 9%.
What items are considered clothing for tax purposes in New Mexico?
In New Mexico, clothing includes general apparel like shirts, pants, dresses, and shoes but excludes accessories, protective gear, and sports equipment, which may be subject to use tax.
What are the general sales tax rates applicable to businesses selling in NM?
New Mexico's sales tax, known as Gross Receipts Tax, varies by location, ranging from 5% to over 9%.
Are there any exemptions for clothing sales in New Mexico?
New Mexico generally taxes clothing sales, but exemptions may apply for specific situations like nonprofit sales or government-issued purchase exemptions.
Kintsugi Intelligence automates location-based tax rate application, exemption management, and accurate reporting across all your one-click integrations to ERP, HR, and eCommerce systems like Shopify, BigCommerce, Amazon, Quickbooks, and Rippling.
Business Tax Obligations for Clothing Sales in NM
While New Mexico does not have specific tax rates for clothing, certain transactions may qualify for Gross Receipts Tax (GRT) exemptions, helping businesses reduce tax liability. Below are some examples.
Table: Exemptions and Sales Tax on Apparel in New Mexico
Exemption Type | Eligible Transactions | Details |
|---|---|---|
Resale Exemption | Clothing purchased for resale | Retailers buying inventory to resell must provide a valid NTTC (Nontaxable Transaction Certificate). |
Nonprofit Exemption | Purchases made by 501(c)(3) nonprofits | Nonprofits must present an NTTC to vendors for tax-free purchases of clothing related to their mission. |
Interstate Sales | Clothing shipped outside New Mexico | Sales to customers outside the state are exempt if proof of out-of-state delivery is documented. |
Government Purchases | Clothing bought by federal, state, or local entities | Requires proper documentation showing government exemption status. |
Key Points
Businesses must issue a valid Nontaxable Transaction Certificate (NTTC) to claim exemptions.
Without proper documentation, clothing sales are taxed at the local GRT rate (5%–9%+), even if intended for exempt purposes.
Exemptions apply only to eligible transactions; personal use or non-qualifying business purchases are always taxable.
FAQs
Is New Mexico part of the Streamlined Sales Tax program?
No, New Mexico is not part of the Streamlined Sales Tax (SST) program because it uses a Gross Receipts Tax (GRT) instead of a traditional sales tax.
Are there different clothing tax rates for New Mexico businesses?
No, New Mexico businesses pay the same Gross Receipts Tax (GRT) on clothing, with rates varying by location, typically between 5% and over 9%.
Are there sales tax holidays in New Mexico?
Yes, New Mexico offers an annual sales tax holiday in August, exempting clothing, school supplies, and computers from Gross Receipts Tax (GRT) for qualifying purchases.
Is there sales tax on apparel in New Mexico?
Yes, apparel is subject to New Mexico’s Gross Receipts Tax (GRT), with rates ranging from 5% to over 9%, depending on location.
What is the shopping tax in New Mexico?
New Mexico applies a Gross Receipts Tax (GRT) instead of sales tax, ranging from 5% to over 9%, varying by location and type of transaction.
For details on New Mexico sales tax exemptions, read Kintsugi's guide: The New Mexico Sales Tax Exemption: 2025 Business Guide.
Automate New Mexico Sales Tax on Clothing for Your Business
Managing New Mexico sales tax compliance can be complex, from verifying local tax rates to tracking exemptions and meeting filing deadlines. Kintsugi simplifies this process with powerful automation tools designed for modern businesses.
Kintsugi helps retailers navigate New Mexico’s complex Gross Receipts Tax (GRT) system for clothing sales, ensuring accurate tax calculations and exemption management.
Challenge | How Kintsugi Helps | Benefits |
|---|---|---|
Tax Rate Variations | Automates GRT rate calculations for locations with varying rates (5%–9%+). | Prevents errors and ensures accuracy. |
Exempt Apparel Management | Identifies and applies exemptions for qualifying clothing (e.g., for resale). | Reduces tax liability on exempt items. |
Exemption Certificate Storage | Tracks and validates resale certificates for wholesale clothing purchases. | Ensures compliance with state laws. |
Reporting and Filing | Prepares detailed GRT reports, separating taxable and exempt apparel sales. | Saves time and simplifies tax filing. |
Audit Readiness | Centralizes transaction records and certificates for audit preparedness. | Minimizes penalties and audit risks. |
Streamlining Retail Sales Tax for Clothing in New Mexico
Let Kintsugi handle the complexities of New Mexico sales tax so you can focus on growing your business. Visit our Product Platform and Pricing pages to learn more and get started today!
