# New Mexico aircraft tax

> New Mexico taxes aircraft through its gross receipts tax, 4.875 percent state rate plus local, but half of the receipts from selling an aircraft are deductible and aircraft parts and maintenance are fully deductible. Aircraft rentals and flight instruction are taxed, and based aircraft register yearly in place of property tax.

Source: https://www.aerscheduler.com/aircraft-tax/united-states/new-mexico
Checked: 2026-10-18

## Do you pay sales tax on an aircraft bought in New Mexico?

**Depends.** New Mexico's gross receipts tax, usually passed on to the buyer, runs from 4.875% to 10.8125% depending on location. Fifty percent of the receipts from selling an aircraft may be deducted, so the tax falls on half the price.

> "Gross receipts tax (GRT) is imposed on businesses, but it is common for a business to pass the GRT on to the purchaser."
>
> New Mexico Taxation and Revenue Department, [Gross Receipts Tax Overview](https://www.tax.newmexico.gov/businesses/gross-receipts-overview/). Checked 2026-10-18.

> "The gross receipts tax rate varies throughout the state from 4.875% to 10.8125%"
>
> New Mexico Taxation and Revenue Department, [FYI-105, Gross Receipts & Compensating Taxes: An Overview](https://realfile.tax.newmexico.gov/FYI-105.pdf), dated FYI-105, 08/11/2025. Checked 2026-10-18.

> "Except for receipts deductible under Subsection B of this section, fifty percent of the receipts from selling agricultural implements, farm tractors, aircraft or vehicles that are not required to be registered under the Motor Vehicle Code may be deducted from gross receipts"
>
> New Mexico Laws, [Section 7-9-62(A) NMSA 1978, as amended by HB 14 (2014)](https://www.nmlegis.gov/Sessions/14%20regular/final/HB0014.pdf), dated Laws 2014, effective July 1, 2014. Checked 2026-10-18.

> "If you sell agricultural implements, vehicles or aircraft and your receipts are deductible under Section 7-9-62(A), use the required deduction code of D0-006 to report your deductible receipts."
>
> New Mexico Taxation and Revenue Department, [FYI-105, Gross Receipts & Compensating Taxes: An Overview](https://realfile.tax.newmexico.gov/FYI-105.pdf), dated FYI-105, 08/11/2025. Checked 2026-10-18.

## Do you owe use tax on an aircraft bought outside New Mexico?

**Depends.** Compensating tax applies to property used in New Mexico that was bought without gross receipts tax. A similar tax charged by another state may be credited, up to the compensating tax due.

> "Compensating tax is an excise tax imposed on persons making taxable use of property, license, franchise or services in New Mexico as described below (7-9-7)."
>
> New Mexico Taxation and Revenue Department, [FYI-105, Gross Receipts & Compensating Taxes: An Overview](https://realfile.tax.newmexico.gov/FYI-105.pdf), dated FYI-105, 08/11/2025. Checked 2026-10-18.

> "Note: If another states tax similar to gross receipts, sales, or compensating tax has been charged you may be able to claim a credit for that tax paid in an amount not to exceed the amount of compensating tax due on the property or services used in New Mexico (7-9-79)."
>
> New Mexico Taxation and Revenue Department, [FYI-105, Gross Receipts & Compensating Taxes: An Overview](https://realfile.tax.newmexico.gov/FYI-105.pdf), dated FYI-105, 08/11/2025. Checked 2026-10-18.

## What aircraft sales tax exemptions does New Mexico have?

**Depends.** Receipts of an aircraft manufacturer or its affiliate from selling aircraft, flight support, or pilot and maintenance training are fully deductible. In-state charter flights, with a pilot, are not subject to gross receipts tax. We found no nonresident fly-away deduction.

> "Receipts of an aircraft manufacturer or affiliate from selling aircraft or from selling aircraft flight support, pilot training or maintenance training services may be deducted from gross receipts."
>
> New Mexico Laws, [Section 7-9-62(B) NMSA 1978, as amended by HB 14 (2014)](https://www.nmlegis.gov/Sessions/14%20regular/final/HB0014.pdf), dated Laws 2014, effective July 1, 2014. Checked 2026-10-18.

> "Receipts from in-state charter flights are not subject to gross receipts tax."
>
> New Mexico Administrative Code, [3.2.207.8 NMAC, Example 4](https://www.srca.nm.gov/parts/title03/03.002.0207.html). Checked 2026-10-18.

## Are aircraft rentals taxed in New Mexico?

**Taxed.** Receipts from leasing airplanes are subject to gross receipts tax. A charter, where the operator supplies the pilot, is not a lease.

> "The receipts from leasing airplanes and flight instructions are subject to the gross receipts tax."
>
> New Mexico Administrative Code, [3.2.207.8 NMAC, Example 4](https://www.srca.nm.gov/parts/title03/03.002.0207.html). Checked 2026-10-18.

> "A charter is not a lease."
>
> New Mexico Administrative Code, [3.2.207.8 NMAC, Example 4](https://www.srca.nm.gov/parts/title03/03.002.0207.html). Checked 2026-10-18.

## Is flight instruction taxed in New Mexico?

**Taxed.** Flight instruction receipts are subject to gross receipts tax, as are the school's airplane rentals.

> "The receipts from leasing airplanes and flight instructions are subject to the gross receipts tax."
>
> New Mexico Administrative Code, [3.2.207.8 NMAC, Example 4](https://www.srca.nm.gov/parts/title03/03.002.0207.html). Checked 2026-10-18.

## Are aircraft parts and maintenance labor taxed in New Mexico?

**Exempt.** Receipts from selling aircraft parts, and from maintenance services on aircraft or aircraft parts, are fully deductible from gross receipts.

> "Receipts from selling aircraft parts or maintenance services for aircraft or aircraft parts may be deducted from gross receipts."
>
> New Mexico Laws, [Section 7-9-62(C) NMSA 1978, as amended by HB 14 (2014)](https://www.nmlegis.gov/Sessions/14%20regular/final/HB0014.pdf), dated Laws 2014, effective July 1, 2014. Checked 2026-10-18.

> "If you sell aircraft parts, provide maintenance services for aircraft and aircraft parts and your receipts are deductible under Section 7 -9-62(C), use the required deduction code of D0-008 to report your deductible receipts."
>
> New Mexico Taxation and Revenue Department, [FYI-105, Gross Receipts & Compensating Taxes: An Overview](https://realfile.tax.newmexico.gov/FYI-105.pdf), dated FYI-105, 08/11/2025. Checked 2026-10-18.

## Does New Mexico register or tax aircraft every year?

**Taxed.** Aircraft based or hangared in New Mexico register every year with the Aviation Division, in place of personal property tax. The fee runs from two cents a pound of maximum gross weight for a model a year old or less down to one cent a pound at five years or more, capped at $300 per engine; a hot air balloon pays $10.

> "All aircraft based or hangared within this state shall be registered annually with the division, and a registration fee shall be paid as approved in the Aircraft Registration Act."
>
> New Mexico Laws, [Section 64-4-4(A) NMSA 1978, as amended by HB 458 (2003)](https://www.nmlegis.gov/Sessions/03%20Regular/FinalVersions/HB0458.html), dated Laws 2003, effective July 1, 2003. Checked 2026-10-18.

> "when the model of the aircraft is one year or less old immediately prior to the year for which it is being registered, two cents ($.02) a pound of manufacturer's maximum gross weight"
>
> New Mexico Laws, [Section 64-4-11(A) NMSA 1978, as amended by HB 458 (2003)](https://www.nmlegis.gov/Sessions/03%20Regular/FinalVersions/HB0458.html), dated Laws 2003, effective July 1, 2003. Checked 2026-10-18.

> "when the model of the aircraft is five years or more old immediately prior to the year for which it is being registered, one cent ($.01) a pound of manufacturer's maximum gross weight"
>
> New Mexico Laws, [Section 64-4-11(A) NMSA 1978, as amended by HB 458 (2003)](https://www.nmlegis.gov/Sessions/03%20Regular/FinalVersions/HB0458.html), dated Laws 2003, effective July 1, 2003. Checked 2026-10-18.

> "The fees charged in Subsection A of this section shall not exceed three hundred dollars ($300) per engine regardless of the weight or age of the aircraft."
>
> New Mexico Laws, [Section 64-4-11(B)-(C) NMSA 1978, as amended by HB 458 (2003)](https://www.nmlegis.gov/Sessions/03%20Regular/FinalVersions/HB0458.html), dated Laws 2003, effective July 1, 2003. Checked 2026-10-18.

> "hot air balloons, a flat fee of ten dollars ($10.00) regardless of the age and weight of aircraft"
>
> New Mexico Laws, [Section 64-4-11(A)(7) NMSA 1978, as amended by HB 458 (2003)](https://www.nmlegis.gov/Sessions/03%20Regular/FinalVersions/HB0458.html), dated Laws 2003, effective July 1, 2003. Checked 2026-10-18.

> "The fees set by this section are in lieu of all personal property taxes on aircraft authorized by any law of this state."
>
> New Mexico Laws, [Section 64-4-11(C) NMSA 1978, as amended by HB 458 (2003)](https://www.nmlegis.gov/Sessions/03%20Regular/FinalVersions/HB0458.html), dated Laws 2003, effective July 1, 2003. Checked 2026-10-18.

_Not tax advice. Confirm with the state's revenue department or a CPA before a purchase or a pricing decision._