New Mexico Discusses Taxability of Broadcast and Online Television Advertisements

Receipts from a cable and satellite television network’s sales of broadcast time to out-of-state advertisers are deductible from gross receipts for tax purposes. However, gross receipts tax is due on receipts from sales of broadcast time to advertisers located in New Mexico. Additionally, sales of online advertising time sold to national and regional advertisers by employees located outside of the state qualify as statutorily exempt sales of services performed outside of New Mexico, provided the website used is on a server located outside the state and the product of the service is not initially used in the state. (Ruling No. 455-08-1, December 31, 2008)

Posted on June 5, 2009