Nogales Transaction Privilege Tax Rates
|City/Town Name: Nogales City Code: NO||Business Code||Tax Rate|
|Timbering and Other Extraction||020||2.00%|
|Hotel/Motel (Additional Tax)||144||4.00%|
|Residential Rental, Leasing & Licensing for Use||045||2.00%|
|Commercial Rental, Leasing & Licensing for Use||213||2.00%|
|Rental, Leasing & Licensing for Use of TPP||214||2.00%|
|Restaurants and Bars||011||2.00%|
|Retail Sales Food for Home Consumption||062||2.00%|
|Public Utility Right of Way||133||2.00%|
|Wastewater Removal Services||485||2.00%|
Amendments or Special Provisions
1. See Article VII below.
2. Impose an additional 4.00% bed tax.
3. On October 17, 2016, the City Council of Nogales passed Ordinance No. 02016-10-005. Ordinance No. 02016-10-005 amended the City Tax Code to create a tax rate on Wastewater Utility Services at two percent (2.00%) effective January 1, 2017.
Article VII - Sales to Foreign Purchasers
Sec. 15A-700. General definitions.
(a) Jobber or Wholesaler: A person who sells tangible personalty for resale, and not for consumption by the purchaser.
(b) Wholesale Sale: A sale for resale. No tax is imposed upon selling tangible personalty at wholesale ("sale for resale").
(c) Foreign Wholesaler: A man or woman or organization who buys goods in the City for the purpose of reselling outside the national jurisdiction of the United States.
Sec. 15A-701. Retail sales; exemptions.
Privilege tax must be paid on all retail sales made to purchasers from Mexico and other foreign countries, unless sufficient evidence of sales in foreign commerce is substantiated by records of the taxpayer to the satisfaction of the Tax Collector. Evidence as to place and conditions of delivery in the case of Mexican sales shall be:
(a) A common carrier receipt
(b) A bill of lading
(c) A manifest
(d) Custom Shippers' Export Declaration
Sec. 15A-702. Burden of proof: retail sales; measure of tax; exclusions.
Burden of Proof: The burden of proving that a transaction is not a retail sale is upon the seller. This burden never shifts. That is, the seller must maintain records that will satisfy the City or that the sale was indeed at wholesale. If the seller wishes to claim the wholesale privilege, then he must take from the purchaser a certificate, which states the name of the purchaser, the purchaser's business address, bears the purchaser's signature, which states that the property for resale in the ordinary course of business, and that the purchaser has a valid license to resell the type of property he has purchased. An invoice may function as the aforesaid certificate if it contains the aforementioned information and purchaser's signature.
Sec. 15A-703. Invoices as records.
The sellers records must separate retail and wholesale sales or all sales will be taxable. For out-of-state dealers, which includes Foreign Wholesalers and Jobbers, the seller should also obtain the foreign dealer's business address. This may appear on the invoice, if that be used in place of a certificate.
Sec. 15A-704. Acceptable Mexican documents.
The American seller shall obtain from the Mexican purchaser at least one of two documents: (a) either the State certificate (e.g., Sonora) permitting the purchaser to engage in business OR (b) the Municipal certificate (e.g., Hermosillo) permitting the purchaser to engage in business. Photocopies of the original certificates are acceptable. The State Certificate must be issued by the State Government of the particular Mexican state and the Municipal certificate must be issued by the Municipal Government of the particular Mexican city. The American seller must then retain these documents for inspection by the City.
Sec. 15A-705. Reasonably prudent businessman.
In this ordinance, the legal standard is that of the Reasonably Prudent Businessman. The American seller's records must meet the City's expectations of what a Reasonably Prudent Businessman would consider to be a wholesale sale.
Sec. 15A-706. Volume of transactions.
To further clarify what the Reasonably Prudent Businessman would consider to be an acceptable volume of transactions when determining if a sale be considered wholesale ("sale for resale"), the standard shall be that of an Average Family. That is, if the volume of the transaction(s) is/are what a Reasonably Prudent Businessman would consider to be only the consumption of an Average Family, then the sale(s) must be TAXED. Unless the supporting documentation meets the burden of proof that the sale was for resale or exempt under paragraph II.
Sec. 15A-707. Small scale foreign jobbers.
It is recognized that there are occasional instances of Small Mexican Jobbers who, on a given day, buy no more than an individual would buy for himself and his family. To claim the Wholesale Privilege, these Small Scale Foreign Jobbers may collect a month's worth of American receipts and present them to the American seller, who must then retain them for the auditor. This is an application of the principle of the Reasonably Prudent Businessman.
Sec. 15A-708. Audit requirement.
In order that these provisions may be fairly enforced, the Board of Aldermen shall provide sufficient funds to provide for an annual audit of any number of the City's businesses subject to this regulation.
Sec. 15A-709. This article controls.
It is explicitly stated that the provisions of this Article shall control in the event of any contradiction(s) with the official text of this code.
History of Rate Changes
Transaction Privilege Tax
2.00% (effective December 1, 2005)
1.25% (effective April 1, 1997)
1.00% (thru March 31, 1997
777 North Grand Avenue
Nogales, AZ 85621