By Montford S.B. No. 878
Substitute the following for S.B. No. 878:
By Oliveira C.S.S.B. No. 878
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. Subsection (f), Section 23.12, Property Tax Code,
1-17 is amended to read as follows:
1-18 (f) The owner of an inventory other than an applicable
1-19 inventory as that term is defined in Section 23.12A of this Code
1-20 may elect to have the inventory appraised at its market value as of
1-21 September of the year preceding the tax year to which the appraisal
1-22 applies by filing an application with the chief appraiser
1-23 requesting that the inventory be appraised as of September 1. The
1-24 application must clearly describe the inventory to which it applies
2-1 and be signed by the owner of the inventory. The application
2-2 applies to the appraisal of the inventory in each tax year that
2-3 begins after the next August 1 following the date the application
2-4 is filed with the chief appraiser unless the owner of the inventory
2-5 by written notice filed with the chief appraiser revokes the
2-6 application or the ownership of the inventory changes. A notice
2-7 revoking the application is effective for each tax year that begins
2-8 after the next September 1 following the date the notice of
2-9 revocation is filed with the chief appraiser.
2-10 SECTION 3. The Property Tax Code is amended by adding
2-11 Section 23.12A. to read as follows:
2-12 Sec. 23.12A. SPECIAL INVENTORY; VALUE. (a) In this
2-13 Section:
2-14 (1) "Applicable inventory" means an inventory that is
2-15 held for resale and that consists of individual units of personal
2-16 property, each unit of which must, as a matter of law, be titled in
2-17 the name of the retail purchaser and be registered with the Texas
2-18 Department of Transportation through the office of the county tax
2-19 assessor-collector.
2-20 (2) "Dealer" means a person who holds a dealer's
2-21 general distinguishing number issued by the Texas Department of
2-22 Transportation under the authority of Article 6686, Revised
2-23 Statutes.
2-24 (3) "Excluded inventory" means that part of an
2-25 applicable inventory that:
2-26 (A) is included in a transaction consisting of
2-27 five or more units sold to a single business entity that has a
3-1 manufacturer's or distributor's fleet identification number
3-2 authorizing the entity to make fleet purchases;
3-3 (B) is included in a transaction between
3-4 dealers; or
3-5 (C) consists of vehicles classified as medium or
3-6 heavy duty trucks of 16,000 pounds gross vehicular weight or more.
3-7 (4) "Owner" means the person responsible for the
3-8 payment of property taxes levied against a special inventory.
3-9 (5) "Sales price" means the total amount of money paid
3-10 or to be paid for the purchase of a motor vehicle as set forth in
3-11 the form entitled "Application for Texas Certificate of Title"
3-12 promulgated by the Texas Department of Transportation.
3-13 (6) "Special inventory" means that part of an
3-14 applicable inventory that remains after subtracting units included
3-15 in excluded inventory.
3-16 (7) "Total annual sales" means the total of the sales
3-17 price from every sale of units from a special inventory for a 12
3-18 month period, or for that portion of a 12 month period for which
3-19 the owner of a special inventory is responsible for the payment of
3-20 property taxes levied against the special inventory.
3-21 (b) Except as provided by Subsection (c) of this section,
3-22 for the purpose of the computation of property tax, the market
3-23 value of a special inventory on January 1 is the total annual sales
3-24 from the special inventory for the 12 month period corresponding to
3-25 the prior tax year, divided by 12.
3-26 (c) For the purpose of the computation of property tax, the
3-27 market value of a special inventory with respect to which sales
4-1 were not made for the entire 12 month period corresponding to the
4-2 prior tax year, the chief appraiser may estimate the market value
4-3 of the special inventory. In making the estimate allowed by this
4-4 subsection the chief appraiser shall extrapolate using sales data,
4-5 if any, generated from the special inventory in the prior tax year.
4-6 (d) Excluded inventory described in Subsection (a)(3)(C) of
4-7 this Section is appraised as provided by Subsection (a), Section
4-8 23.12 of this Code.
4-9 SECTION 4. The Property Tax Code is amended by adding
4-10 Section 23.12B. to read as follows:
4-11 Sec. 23.12B. PREPAYMENT OF TAXES BY CERTAIN TAXPAYERS.
4-12 (a) In this Section:
4-13 (1) "Chief appraiser" means the chief appraiser for
4-14 the appraisal district in which is located an applicable inventory.
4-15 (2) "Collector" means the county tax
4-16 assessor-collector in the county in which is located a special
4-17 inventory.
4-18 (3) "County aggregate tax rate" means the combined tax
4-19 rate of all relevant taxing units in a county.
4-20 (4) "Owner" has the meaning given it in Section 23.12A
4-21 of this Code.
4-22 (5) "Relevant taxing unit" means a taxing unit,
4-23 including the county, authorized by law to levy property taxes
4-24 against a special inventory.
4-25 (6) "Sales price" has the meaning given it in Section
4-26 23.12A of this Code.
4-27 (7) "Special inventory" has the meaning given it in
5-1 Section 23.12A of this Code.
5-2 (8) "Special inventory tax statement" means the form
5-3 promulgated by the Comptroller of Public Accounts as required by
5-4 this Section.
5-5 (9) "Total annual sales" has the meaning given it in
5-6 Section 23.12A of this Code.
5-7 (10) "Unit property tax value factor" is one-twelfth
5-8 of the most recent county aggregate tax rate for the county in
5-9 which a special inventory is located.
5-10 (b) An owner shall assign a unit property tax value to each
5-11 unit sold from a special inventory. The unit property tax value of
5-12 each unit is determined by multiplying the sales price of the unit
5-13 by the unit property tax value factor. On or before the 10th day
5-14 of each month the owner shall deposit with the collector a sum
5-15 equal to the total of unit property tax value assigned to all units
5-16 sold from the special inventory in the prior month. The money
5-17 shall be deposited by the collector in, or otherwise credited by
5-18 the collector to, the owner's escrow account for prepayment of
5-19 property taxes as provided by this Section. An escrow account
5-20 required by this Section is used to pay property taxes levied
5-21 against the special inventory and the owner shall fund the escrow
5-22 account as provided by this Subsection.
5-23 (c) The collector shall maintain the escrow account for each
5-24 owner in the county depository. The collector is not required to
5-25 maintain a separate account in the depository for each escrow
5-26 account created as provided by this Section, but shall maintain
5-27 separate records for each owner. The collector shall retain any
6-1 interest generated by the escrow account to defray the cost of
6-2 administration of the prepayment procedure established by this
6-3 Section. Interest generated by an escrow account created as
6-4 provided by this Section is the sole property of the collector, and
6-5 that interest may be used by no entity other than the collector.
6-6 (d) The owner may not withdraw the money in the escrow
6-7 account.
6-8 (e) The Comptroller of Public Accounts shall promulgate a
6-9 form entitled a Special Inventory Tax Statement. The owner of a
6-10 special inventory shall complete the form with respect to each unit
6-11 sold from the owner's applicable inventory and may use no other
6-12 form for that purpose. The form may include the information the
6-13 comptroller deems appropriate, but shall include at least the
6-14 following:
6-15 (1) a description of the unit sold;
6-16 (2) a statement as to whether or not the unit was sold
6-17 from the owner's special inventory;
6-18 (3) the sales price of the unit;
6-19 (4) the unit property tax value of the unit if the
6-20 unit was sold from the owner's special inventory; and
6-21 (5) the reason the unit was excluded from the owner's
6-22 special inventory, if no unit property tax value is assigned.
6-23 (f) On or before the tenth day of each month the owner of a
6-24 special inventory shall file with the chief appraiser the Special
6-25 Inventory Tax Statement for each unit sold by the owner from the
6-26 owner's applicable inventory in the prior month. An owner shall
6-27 retain documentation relating to the disposition of each unit sold
7-1 from an applicable inventory, including documentation relating to
7-2 the exclusion of a unit from special inventory and shall make that
7-3 documentation available to the chief appraiser upon request.
7-4 (g) A relevant taxing unit shall, on its tax bill prepared
7-5 for the owner of a special inventory, separately itemize the taxes
7-6 levied against the special inventory. When the tax bill is
7-7 prepared by a relevant taxing unit for a special inventory, the
7-8 assessor for the taxing unit, or an entity, if any, other than the
7-9 collector, that collects taxes on behalf of the taxing unit, shall
7-10 provide the collector a true and correct copy of the tax bill sent
7-11 to the owner, including taxes levied against the owner's special
7-12 inventory. The collector shall apply the money in the owner's
7-13 escrow account to the taxes imposed and deliver a tax receipt to
7-14 the owner. The collector shall apply the amount to each relevant
7-15 taxing unit in proportion to the amount of taxes levied, and the
7-16 assessor of each relevant taxing unit shall apply the funds
7-17 received from the collector to the taxes owed by the owner.
7-18 (h) If the amount in the escrow account is not sufficient to
7-19 pay the taxes in full, the collector shall apply the money to the
7-20 taxes and deliver to the owner a tax receipt for the partial
7-21 payment and a tax bill for the unpaid amount together with a
7-22 statement that the owner must remit to the collector the balance of
7-23 the total tax due.
7-24 (i) The collector shall remit to each relevant taxing unit
7-25 the total amount collected by the collector in deficiency payments.
7-26 The assessor of each relevant taxing unit shall apply those funds
7-27 to the taxes owed by the owner. Taxes that are due, but not
8-1 received by the collector and remitted by the collector to each
8-2 relevant taxing unit on or before January 31 are delinquent.
8-3 (j) The collector shall annually distribute among the
8-4 relevant taxing units in proportion to the taxes levied by each
8-5 against the special inventory, funds, if any, that remain in the
8-6 escrow account after the payment of all property taxes due.
8-7 (k) Not later than February 1 of each year, or, in the case
8-8 of an owner who was not in business on January 1, not later than 30
8-9 days after commencement of business, each owner shall file a
8-10 special inventory declaration with the chief appraiser and file a
8-11 copy with the county tax assessor-collector. The declaration is
8-12 sufficient to comply with this Subsection if it sets forth the
8-13 following information:
8-14 (1) the name and business address of each location at
8-15 which the owner conducts business;
8-16 (2) each of the owner's general distinguishing
8-17 numbers, if the owner has a general distinguishing number issued by
8-18 the Texas Department of Transportation;
8-19 (3) a statement that the owner is the owner of a
8-20 special inventory; and
8-21 (4) the market value of the inventory for the current
8-22 tax year as computed under Subsection (b), Section 23.12A of this
8-23 Code.
8-24 (l) An owner who fails to file a special inventory
8-25 declaration required by this Section commits an offense. An
8-26 offense under this Subsection is a misdemeanor punishable by a fine
8-27 not to exceed $500. A fine collected under this Subsection may be
9-1 used only by the collector to defray the cost of enforcing this
9-2 Section. Each day during which an owner fails to comply with the
9-3 terms of this Subsection is a separate violation.
9-4 (m) An owner who fails to file a special inventory tax
9-5 statement as required by this Section commits an offense. An
9-6 offense under this Subsection is a misdemeanor punishable by a fine
9-7 not to exceed $100. A fine collected under this Subsection may be
9-8 used only by the collector to defray the cost of enforcing this
9-9 Section. Each day during which an owner fails to comply with the
9-10 terms of this Subsection is a separate violation.
9-11 (n) An owner who fails to remit the amounts due as required
9-12 by Subsection (b) of this Section shall pay a penalty of 5 percent
9-13 of the amount due. If the amount is not paid within 10 days after
9-14 the due date, the owner shall pay an additional penalty of 5
9-15 percent of the amount due. The county attorney shall enforce the
9-16 terms of this Subsection, and a penalty collected under this
9-17 Subsection may be used only by the collector to defray the cost of
9-18 enforcing this Section. A penalty under this Subsection is in
9-19 addition to any penalty that may be due if the owner's taxes are
9-20 not paid in full by January 31.
9-21 SECTION 5. This bill is effective January 1, 1994. The
9-22 market value of a special inventory on January 1, 1994 is one
9-23 twelfth of total annual sales from the special inventory for tax
9-24 year 1993.
9-25 SECTION 6. The importance of this legislation and the
9-26 crowded condition of the calendars in both houses create an
9-27 emergency and an imperative public necessity that the
10-1 constitutional rule requiring bills to be read on three several
10-2 days in each house be suspended, and this rule is hereby suspended,
10-3 and that this Act take effect and be in force according to its
10-4 terms, and it is so enacted.