New Mexico does not have a sales tax. It has a gross receipts tax
instead. This tax is imposed on persons engaged in business in New
Mexico, but in almost every case the person engaged in business passes
the tax to the consumer. More information can be found at
http://www.state.nm.us/tax/trd_ques.htm

Link that explains your question,
(BKS) wrote in message . com...
Recently, I am trying to put my home for sale. Broker filled out the
sales contract and mailed out to me (I am out of town..home is in
different town). His commission shows 5% PLUS sales tax on purchase
price of the home. Is it normal practice to pay state sales tax in
addition to commission the agent is getting? Why sales tax? Do
Brokers have to pay sales tax on commission they get from the sale of
the home? Home is in New Mexico.

Right now I am renting that home and the same broker is managing the
property. He charges 10% of monthly rent plus sales tax on his 10%
commission. I was renting my home for the first time, so I thought it
was normal to pay sales tax on 10% rental commission.

Now i am trying to sell home, he is tryng to do the same. Now I
realize I should never have paid sales tax on his 10% rental
commission. can anyone tell me how should I approach this situation?
Thanks.