State Tax Day - Current, S.7, New Mexico—Tobacco Tax, Practice and Procedure: Rules Regarding New Regulations, Cigarette Taxes Amended, (Sep 24, 2026)

The New Mexico Department of Taxation and Revenue has adopted amended rules effective September 22, 2026. These are its rule about promulgation of regulations and its general rule about its cigarette and tobacco products taxes.

Promulgation of Regulations

The Department amended its rule regarding promulgation of regulations to shorten the timeframe for public hearings on proposed regulations from 45 days to 30 days after the issuance and filing of a proposed regulation. The amendments also change the Department's ruling procedures by removing language requiring review by the attorney general or other legal counsel before a ruling is issued and clarifying that a ruling may be superseded by a statute, regulation, or another ruling. The amendments also create a more detailed framework for tribal tax cooperative agreements.

Cigarette and Tobacco Tax

The updated general rule adds new definitions, including a definition of “carton,” and incorporates guidance on compliant cigarette packaging labels into the definitions section. The department also repealed a provision that specifically required cigarettes awarded as prizes at carnivals, fairs, and similar events to bear New Mexico tax stamps. In addition, the rule modernizes several administrative provisions by updating reporting references and reorganizing existing requirements.

The amended rule also makes changes affecting enforcement and appeals. It expands and clarifies the civil penalty provisions by applying penalties to individual business locations, expressly accounting for loose packs as well as cartons of cigarettes, and extending the highest penalty schedule to third and subsequent violations. It also creates a new exception preventing penalties when improperly affixed stamps result from defects in the stamp manufacturer’s product. The department further revised its seizure and forfeiture rules and replaced the prior appeals process with a new framework that establishes updated filing requirements, a longer appeal period, and a formal timeline for department review.

New Mexico Register, Volume XXXVII, Issue 18, September 22, 2026