By Oliveira H.B. No. 1890
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the value of certain types of property for purposes of
1-3 property taxation and to the prepayment of property taxes by
1-4 certain taxpayers.
1-5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-6 SECTION 1. Subsection (a), Section 23.12, Property Tax Code,
1-7 is amended to read as follows:
1-8 (a) Except as provided by Section 23.12A of this Code, the
1-9 <The> market value of an inventory is the price for which it would
1-10 sell as a unit to a purchaser who would continue the business. An
1-11 inventory shall include residential real property which has never
1-12 been occupied as a residence and is held for sale in the ordinary
1-13 course of a trade or business, provided that the residential real
1-14 property remains unoccupied, is not leased or rented, and produces
1-15 no income.
1-16 SECTION 2. The Property Tax Code is amended by adding
1-17 Section 23.12A. to read as follows:
1-18 Sec. 23.12A. SPECIAL INVENTORY; VALUE. (a) In this
1-19 section:
1-20 (1) "Applicable inventory" means an inventory that is
1-21 held for resale and that consists of individual units of personal
1-22 property, each unit of which must, as a matter of law, be titled in
1-23 the name of the retail purchaser and be registered with the Texas
2-1 Department of Transportation through the office of the county tax
2-2 assessor-collector.
2-3 (2) "Dealer" means a person who holds a dealer's
2-4 general distinguishing number issued by the Texas Department of
2-5 Transportation under the authority of Article 6686, Revised
2-6 Statutes.
2-7 (3) "Excluded inventory" means that part of an
2-8 applicable inventory that is included in:
2-9 (A) a transaction consisting of five or more
2-10 units sold to a single business entity; or
2-11 (B) a transaction between dealers.
2-12 (4) "Owner" means the person responsible for the
2-13 payment of property taxes levied against a special inventory.
2-14 (5) "Sales price" means the total amount of money paid
2-15 or to be paid for the purchase of a motor vehicle as set forth as
2-16 "Taxable Value" in the form entitled "Tax Collector's Receipt for
2-17 Texas Title Application/Registration/Motor Vehicle Tax" promulgated
2-18 by the Texas Department of Transportation.
2-19 (6) "Special inventory" means that part of an
2-20 applicable inventory that remains after subtracting units included
2-21 in excluded inventory.
2-22 (7) "Total annual sales" means the total of the sales
2-23 price from every sale of units from a special inventory for a 12
2-24 month period, or for that portion of a 12 month period for which
2-25 the owner of a special inventory is responsible for the payment of
3-1 property taxes levied against the special inventory.
3-2 (b) Except as provided by Subsection (c) of this section,
3-3 for the purpose of the computation of property tax, the market
3-4 value of a special inventory is the total annual sales from the
3-5 special inventory for the 12 month period corresponding to the
3-6 prior tax year, divided by 12.
3-7 (c) For the purpose of the computation of property tax, the
3-8 market value of a special inventory with respect to which sales
3-9 were not made for the entire 12 month period corresponding to the
3-10 prior tax year, the chief appraiser may estimate the market value
3-11 of the special inventory. In making the estimate allowed by this
3-12 subsection the chief appraiser shall extrapolate using sales data,
3-13 if any, generated from the special inventory in the prior tax year.
3-14 SECTION 3. The Property Tax Code is amended by adding
3-15 Section 23.12B. to read as follows:
3-16 Sec. 23.12B. PREPAYMENT OF TAXES BY CERTAIN TAXPAYERS. (a)
3-17 In this section:
3-18 (1) "Cost of goods sold" means 90 percent of total
3-19 annual sales.
3-20 (2) "Collector" means the county tax
3-21 assessor-collector in the county in which is located a special
3-22 inventory.
3-23 (3) "Owner" has the meaning given it in Section 23.12A
3-24 of this Code.
3-25 (4) "Relevant taxing unit" means a taxing unit,
4-1 including the county, authorized by law to levy property taxes
4-2 against a special inventory.
4-3 (5) "Sales price" has the meaning given it in Section
4-4 23.12A of this Code.
4-5 (6) "Special inventory" has the meaning given it in
4-6 Section 23.12A of this Code.
4-7 (7) "Total annual sales" has the meaning given it in
4-8 Section 23.12A of this Code.
4-9 (b) The owner of a special inventory shall deposit money in
4-10 an escrow account maintained by the collector to provide for the
4-11 prepayment of property taxes levied against the owner's special
4-12 inventory. An escrow account required by this section is used to
4-13 pay property taxes levied against the special inventory and the
4-14 owner shall fund the escrow account as provided by Subsection (c)
4-15 of this section.
4-16 (c) An owner shall assign a unit property tax value to each
4-17 unit sold from a special inventory. The unit property tax value of
4-18 each unit is determined by multiplying the sales price of the unit
4-19 by a factor determined by dividing the total of all property taxes
4-20 paid by the owner on the special inventory for the prior tax year
4-21 by the cost of goods sold from the special inventory in the prior
4-22 year. On or before the 10th day of each month the owner shall
4-23 deposit with the collector a sum equal to the total of unit
4-24 property tax value assigned to all units sold from the special
4-25 inventory in the prior month. The money shall be deposited by the
5-1 collector in, or otherwise credited by the collector to, the
5-2 owner's escrow account for prepayment of property taxes as provided
5-3 by this Section.
5-4 (d) The collector shall maintain the escrow account for each
5-5 owner in the county depository. The collector is not required to
5-6 maintain a separate account in the depository for each escrow
5-7 account created as provided by this section, but shall maintain
5-8 separate records for each owner. The collector shall retain any
5-9 interest generated by the escrow account to defray the cost of
5-10 administration of the prepayment procedure established by this
5-11 section. Interest generated by an escrow account created as
5-12 provided by this section is the sole property of the collector, and
5-13 that interest may be used by no entity other than the collector.
5-14 (e) The owner may not withdraw the money in the escrow
5-15 account.
5-16 (f) The Texas Department of Transportation shall include as
5-17 a part of the form entitled "Tax Collector's Receipt for Texas
5-18 Title Application/Registration/Motor Vehicle Tax" a method by which
5-19 the owner of a unit sold from an applicable inventory may disclose
5-20 the unit property tax value, if any, assigned to the unit. An
5-21 owner shall disclose on the face of that form the unit property tax
5-22 value, if any, assigned to the unit. If no unit property tax value
5-23 is assigned to a unit, the owner shall designate the reason that
5-24 the applicable unit was not sold from special inventory. An owner
5-25 shall retain documentation relating to the exclusion of a unit from
6-1 special inventory and shall make that documentation available to
6-2 the chief appraiser upon request.
6-3 (g) A relevant taxing unit shall, on its tax bill prepared
6-4 for the owner of a special inventory, separately itemize the taxes
6-5 levied against the special inventory. When the tax bill is
6-6 prepared by a relevant taxing unit for a special inventory, the
6-7 assessor for the taxing unit, or an entity, if any, other than the
6-8 collector, that collects taxes on behalf of the taxing unit, shall
6-9 provide the collector a true and correct copy of the tax bill sent
6-10 to the owner, including taxes levied against the owner's special
6-11 inventory. The collector shall apply the money in the owner's
6-12 escrow account to the taxes imposed and deliver a tax receipt to
6-13 the owner. The collector shall apply the amount to each relevant
6-14 taxing unit in proportion to the amount of taxes levied, and the
6-15 assessor of each relevant taxing unit shall apply the funds
6-16 received from the collector to the taxes owed by the owner.
6-17 (h) If the amount in the escrow account is not sufficient to
6-18 pay the taxes in full, the collector shall apply the money to the
6-19 taxes and deliver to the owner a tax receipt for the partial
6-20 payment and a tax bill for the unpaid amount together with a
6-21 statement that the owner must remit to the collector the balance of
6-22 the total tax due.
6-23 (i) The collector shall remit to each relevant taxing unit
6-24 the total amount collected by the collector in deficiency payments
6-25 from owners. The assessor of each relevant taxing unit shall apply
7-1 those funds to the taxes owed by the owner. Taxes that are due,
7-2 but not received by the collector and remitted by the collector to
7-3 each relevant taxing unit on or before January 31 are delinquent.
7-4 (j) The collector shall annually distribute among the
7-5 relevant taxing units in proportion to the taxes levied by each
7-6 against the special inventory, funds, if any, that remain in the
7-7 escrow account after the payment of all property taxes due.
7-8 SECTION 4. The amendments to the Tax Code provided by this
7-9 bill apply to the tax year beginning January 1, 1994.
7-10 SECTION 5. The importance of this legislation and the
7-11 crowded condition of the calendars in both houses create an
7-12 emergency and an imperative public necessity that the
7-13 constitutional rule requiring bills to be read on three several
7-14 days in each house be suspended, and this rule is hereby suspended,
7-15 and that this Act take effect and be in force from and after its
7-16 passage, and it is so enacted.