By Coleman H.B. No. 2447
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to a municipal short-term automobile rental tax by certain
1-3 municipalities
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. The tax code is amended by adding the following
1-6 as Chapter 353.
1-7 CHAPTER 353. MUNICIPAL SHORT-TERM AUTOMOBILE RENTAL TAX ACT
1-8 SUBCHAPTER A. GENERAL PROVISIONS
1-9 Sec. 353.001. SHORT TITLE. This chapter may be cited as the
1-10 Municipal Short-Term Automobile Rental Tax Act.
1-11 Sec. 353.002. DEFINITIONS. (a) In this chapter:
1-12 (1) "Convention Center Facilities" means improvements
1-13 such as civic centers, civic center buildings, civic center hotels,
1-14 auditoriums, theaters, opera houses, music halls, exhibition halls,
1-15 coliseums, stadiums, museums, aquariums, natatoriums and plazas
1-16 located in the vicinity of municipality owned convention center
1-17 facilities and structures, areas, or facilities, to be used in
1-18 connection with such improvements for off-street parking or storage
1-19 of motor vehicles or other conveyances.
1-20 (2) "Motor Vehicle" means a self-propelled vehicle
1-21 designed principally to transport persons or property on a public
1-22 highway and includes a passenger car, van, station wagon, sports
1-23 utility vehicle, truck, and jeep. "Motor Vehicle" does not
2-1 include:
2-2 (A) a trailer, or semi-trailer, house trailer, a
2-3 truck larger than one half ton or road-building machinery,
2-4 (B) a device moved only by human power,
2-5 (C) a device used exclusively on stationary
2-6 rails or tracks,
2-7 (D) a farm machine, or
2-8 (E) a mobile office.
2-9 (3) "Municipal short-term auto rental tax" means the
2-10 tax authorized by Section 353.004.
2-11 (4) "Municipality" means a municipality that has a
2-12 population of at least 1,500,000.
2-13 (5) "Place of business of the owner" means an
2-14 established outlet, office, or location operated by the owner or
2-15 the owner's agent or employee for the purpose of renting motor
2-16 vehicles and includes any location at which three or more rentals
2-17 are made during a calendar year.
2-18 (6) "Rental" means an agreement by the owner of a
2-19 motor vehicle to give for not longer than 30 days the exclusive use
2-20 of that vehicle to another for consideration.
2-21 (b) Except as otherwise defined in Subsection (a), words
2-22 used in this chapter and defined by Chapter 152 have the meanings
2-23 assigned by Chapter 152.
2-24 Sec. 353.003. OTHER PORTIONS OF TAX CODE APPLICABLE.
2-25 Subtitles A and B, Title 2, and Chapter 152 apply to the tax and to
3-1 the administration and enforcement of the tax imposed under this
3-2 chapter in the same manner that those laws apply to state taxes,
3-3 unless modified by this chapter.
3-4 Sec. 353.004. TAX AUTHORIZED. (a) A municipality may by
3-5 ordinance impose a tax on the gross rental receipts from the rental
3-6 of a motor vehicle in the municipality or in the municipality's
3-7 extraterritorial jurisdiction at a rate not to exceed 5 percent of
3-8 the gross rental receipts.
3-9 (b) The municipal short-term auto rental tax does not apply
3-10 to the sale of a motor vehicle or the rental of a motor vehicle for
3-11 a term longer than 30 days.
3-12 Sec. 353.005. EFFECTIVE DATE. A tax imposed under this
3-13 chapter or the repeal of a tax abolished under this chapter takes
3-14 effect on the first day of the first calendar quarter occurring
3-15 after the expiration of the first complete calendar quarter
3-16 occurring after the date on which the comptroller receives a notice
3-17 from the municipality of the adoption, increase, reduction, or
3-18 repeal of the tax imposed under this chapter.
3-19 Sec. 353.006. CONSUMMATION OF RENTAL. (a) A rental of a
3-20 motor vehicle occurs within the municipality in which the rental is
3-21 consummated. A rental is consummated as provided by this section
3-22 regardless of the place where transfer of possession of the motor
3-23 vehicle occurs.
3-24 (b) If an owner of a motor vehicle has only one place of
3-25 business in this state, all of the owner's rentals of motor
4-1 vehicles are consummated at that place of business except as
4-2 provided by Subsection (e).
4-3 (c) If an owner of a motor vehicle has more than one place
4-4 of business in this state, a rental of a motor vehicle is
4-5 consummated at the place of business of the owner:
4-6 (1) from which the owner delivers the motor vehicle,
4-7 if the owner delivers the motor vehicle to a point designated by
4-8 the person renting the motor vehicle from the owner; or
4-9 (2) where the person renting the motor vehicle from
4-10 the owner takes possession of the motor vehicle, if the person
4-11 renting the motor vehicle from the owner takes possession of the
4-12 motor vehicle from a place of business of the owner.
4-13 (d) If neither the possession of the motor vehicle is taken
4-14 at nor delivery of the motor vehicle is made from the place of
4-15 business of the owner in this state, the rental is consummated at:
4-16 (1) the place of business of the owner in this state
4-17 where the order is received; or
4-18 (2) if the order is not received at a place of
4-19 business of the owner, the place of business from which the owner's
4-20 salesman who took the order operates.
4-21 (e) A rental is consummated at the location in this state to
4-22 which a motor vehicle is delivered or at which possession is taken
4-23 by the person renting the motor vehicle from the owner if transfer
4-24 of possession of a motor vehicle occurs at, or delivery of the
4-25 motor vehicle originates from, a location in this state other than
5-1 a place of business of the owner and if:
5-2 (1) the owner has no place of business; or
5-3 (2) the place of business of the owner where the order
5-4 is initially received or from which the owner's salesman who took
5-5 the order operates is outside this state.
5-6 Sec. 353.007. EXEMPTIONS. A person or entity exempted from
5-7 the state tax imposed on gross rental receipts by Chapter 152 under
5-8 Section 152.026 is exempt from the tax authorized by this chapter.
5-9 SUBCHAPTER B. REVENUE USE
5-10 Sec. 353.101. USE OF TAX REVENUE. (a) Revenue from the
5-11 municipal short-term auto rental tax may be used only to promote
5-12 the arts, tourism and the convention and hotel industry, and that
5-13 use is limited to the following:
5-14 (1) the acquisition of sites for and the acquisition,
5-15 construction, improvement, enlarging, equipping, repairing,
5-16 operation, programming and maintenance of convention center
5-17 facilities;
5-18 (2) the furnishing of facilities, personnel, and
5-19 materials for the registration of convention delegates or
5-20 registrants; and
5-21 (3) advertising and conducting solicitations and
5-22 promotional programs to attract tourists and convention delegates
5-23 or registrants to the municipality or its vicinity.
5-24 Sec. 353.102. PLEDGE FOR BONDS. Subject to the limitations
5-25 provided by this subchapter, a municipality may pledge the revenue
6-1 derived from the municipal short-term auto rental tax imposed under
6-2 this chapter for the payment of bonds that are issued by the
6-3 municipality pursuant to Article 1269j-4.1, Vernon's Texas Civil
6-4 Statutes, for one of the purposes set forth in Section 353.101 or
6-5 by a non-profit corporation created by the municipality pursuant to
6-6 the provisions of Section 4B of Article 5190.6, Vernon's Texas
6-7 Civil Statutes, or Section 4A of the Article 1528l Vernon Texas
6-8 Civil Statutes, for one or more of the purposes provided by Section
6-9 353.101.
6-10 Sec. 353.103. CONTRACTS. The governing body of a
6-11 municipality may contract with a person, including another
6-12 governmental entity or a private organization, for the
6-13 construction, operation, management or supervision of programs,
6-14 activities and projects funded with revenue from the tax authorized
6-15 by this chapter. The governing body in writing shall approve in
6-16 advance the annual budget of the person with which it contracts for
6-17 those functions and shall require the person to make periodic
6-18 reports to the governing body at least quarterly listing the
6-19 expenditures made by the person with revenue from the tax
6-20 authorized by this chapter. The person must maintain revenue
6-21 provided from the tax authorized by this chapter in a separate
6-22 account established for that purpose and may not commingle that
6-23 revenue with any other money. The municipality may not delegate to
6-24 any person the management or supervision of its convention and
6-25 visitors programs and activities funded with revenue from the tax
7-1 authorized by this chapter other than by contract as provided by
7-2 this subsection. The approval by the governing body of the
7-3 municipality of the annual budget of the person to whom the
7-4 governing body contracts those functions creates a fiduciary duty
7-5 in the person with respect to the revenue provided by the tax
7-6 authorized by this chapter.
7-7 SUBCHAPTER C. TAX COLLECTION
7-8 Sec. 353.201. COLLECTION OF TAX. (a) The owner of a motor
7-9 vehicle subject to the municipal short-term auto rental tax shall
7-10 collect the tax for the benefit of the municipality. Except as
7-11 inconsistent with this chapter and the rules adopted under this
7-12 chapter, an owner of a motor vehicle subject to the municipality
7-13 short-term auto rental tax on gross rental receipts that may be
7-14 imposed under this chapter shall report and pay the tax to the
7-15 comptroller in the same manner as the tax on gross rental receipts
7-16 from the rental of a rented motor vehicle imposed by Section
7-17 152.026 is reported and paid by the owner under Chapter 152.
7-18 (b) The owner shall add the municipal short-term auto rental
7-19 tax to the rental charge for rentals of motor vehicles, and when
7-20 added, the tax is:
7-21 (1) a part of the rental charge;
7-22 (2) a debt owed to the motor vehicle owner by the
7-23 person renting the vehicle; and
7-24 (3) recoverable at law in the same manner as the
7-25 rental charge.
8-1 (c) The comptroller may proceed against a person renting a
8-2 motor vehicle for any unpaid municipal short-term auto rental tax.
8-3 Sec. 353.202. GROSS RECEIPTS PRESUMED SUBJECT TO TAX. All
8-4 gross receipts of an owner from the rental of a motor vehicle are
8-5 presumed to be subject to the municipal short-term auto rental tax,
8-6 except for gross receipts for which the owner has accepted in good
8-7 faith a properly completed resale or exemption certificate.
8-8 Sec. 353.203. RECORDS. (a) The owner of a motor vehicle
8-9 used for rental purposes shall keep for four years records and
8-10 supporting documents containing the following information on the
8-11 amount of:
8-12 (1) gross rental receipts received from the rental of
8-13 the motor vehicle; and
8-14 (2) the municipal short-term auto rental tax paid to
8-15 the comptroller on each motor vehicle used for rental purposes by
8-16 the owner.
8-17 (b) No mileage records are required.
8-18 Sec. 353.204. FAILURE TO KEEP RECORDS. (a) An owner
8-19 commits an offense if he fails to make and retain complete records
8-20 for the period of four years as provided by Section 353.203.
8-21 (b) An offense under this section is a misdemeanor
8-22 punishable by a fine of not less than $25 nor more than $500.
8-23 SUBCHAPTER D. ADMINISTRATION OF TAXES
8-24 Sec. 353.301. COMPTROLLER TO COLLECT AND ADMINISTER TAXES.
8-25 The comptroller shall administer, collect and enforce any tax
9-1 imposed by a municipality under this chapter. The tax imposed
9-2 under this chapter and the tax imposed on gross rental receipts
9-3 from the rental of a rented motor vehicle under Chapter 152 shall
9-4 be collected together, if both taxes are imposed.
9-5 Sec. 353.302. COMPTROLLER'S REPORTING DUTIES. (a) The
9-6 comptroller shall make quarterly reports to a municipality that has
9-7 adopted the taxes authorized by this chapter if the municipality
9-8 requests the reports. A report must include the name, address, and
9-9 account number of each person in the municipality that has remitted
9-10 to the comptroller a tax payment during the quarter covered by the
9-11 report.
9-12 (b) If a municipality requests an additional report, the
9-13 comptroller shall make an additional quarterly report to the
9-14 municipality including the name, address, and account number, if
9-15 any, of, and the amount of tax due from, each person doing business
9-16 in the municipality who has failed to pay the tax under this
9-17 chapter to the municipality or the tax on gross rental receipts
9-18 from the rental of a rented motor vehicle under Chapter 152. The
9-19 additional report must also include statements:
9-20 (1) showing whether or not there has been a partial
9-21 tax payment by the delinquent taxpayer;
9-22 (2) showing whether or not the taxpayer is delinquent
9-23 in the payment of the tax imposed on gross rental receipts from the
9-24 rental of a rented motor vehicle under Chapter 152 to the state;
9-25 and
10-1 (3) describing the steps taken by the comptroller to
10-2 collect the delinquent taxes.
10-3 (c) If a municipality determines that a person doing
10-4 business in the municipality is not included in a comptroller's
10-5 report, the municipality shall report to the comptroller the name
10-6 and address of the person. Within 90 days after receiving the
10-7 report from a municipality, the comptroller shall send to the
10-8 municipality:
10-9 (1) an explanation as to why the person is not
10-10 obligated for the municipal short-term auto rental tax;
10-11 (2) a statement that the person is obligated for the
10-12 municipal short-term auto rental tax and the tax is delinquent; or
10-13 (3) a certification that the person is obligated for
10-14 the municipal short-term auto rental tax and that the full amount
10-15 of the tax due has been credited to the municipality's account.
10-16 (d) The comptroller shall send by United States certified or
10-17 registered mail to the municipal tax collector a notice of each
10-18 person who is delinquent in the payment to the municipality of the
10-19 tax authorized by this chapter and shall send a copy of the notice
10-20 to the attorney general. A notice sent under this subsection is a
10-21 certification of the amount of tax owed and is prima facie evidence
10-22 of a determination of that amount and of its delinquency.
10-23 Sec. 353.303. SALES TAX PERMITS AND EXEMPTION AND RESALE
10-24 CERTIFICATES. (a) Each place of business of an owner must have a
10-25 permit issued by the comptroller under Subchapter F, Chapter 151.
11-1 (b) The same sales tax permit, exemption certificate, and
11-2 resale certificate required by Chapter 152 for the administration
11-3 and collection of the taxes imposed under that chapter satisfy the
11-4 requirements of this chapter. No additional permit or exemption or
11-5 resale certificate may be required.
11-6 Sec. 353.304. DISCOUNTS FOR PREPAYMENT AND TAX COLLECTION.
11-7 All discounts allowed a retailer under Chapter 151 for the
11-8 collection and prepayment of the taxes under that chapter are
11-9 allowed and applicable to the taxes collected under this chapter.
11-10 Sec. 353.305. PENALTIES AND INTEREST. The penalties and
11-11 interest provided by Chapter 152 for failure to pay the tax imposed
11-12 on gross rental receipts from the rental of a rented motor vehicle
11-13 under Chapter 152 are applicable to the tax imposed under this
11-14 chapter.
11-15 Sec. 353.306. COMPTROLLER'S RULES. The comptroller may
11-16 adopt reasonable rules and prescribe forms that are consistent with
11-17 this chapter for the administration, collection, reporting, and
11-18 enforcement of the tax imposed under this chapter.
11-19 Sec. 353.307. DELINQUENT TAXES: LIMITATIONS. The
11-20 limitations for the bringing of a suit for the collection of a tax
11-21 imposed or a penalty due under this chapter after the tax and
11-22 penalty are delinquent or after a determination against the
11-23 taxpayer are the same as limitations provided by Chapter 152 with
11-24 respect to the tax imposed on gross rental receipts from the rental
11-25 of a rented motor vehicle under Chapter 152.
12-1 Sec. 353.308. SEIZURE AND SALE OF PROPERTY. If the
12-2 comptroller lawfully seizes property for the payment of the taxes
12-3 imposed on gross rental receipts from the rental of a rented motor
12-4 vehicle under Chapter 152 and the property owner is delinquent in
12-5 the payment of taxes under this chapter, the comptroller shall sell
12-6 sufficient property to pay the delinquent taxes and penalties of
12-7 both taxes. The proceeds of a sale of seized property shall first
12-8 be applied to the payment of amounts due the state and the
12-9 remainder, if any, to the amounts due to the municipality to which
12-10 the taxes are due.
12-11 Sec. 353.309. SUIT FOR TAX COLLECTION. (a) A municipality
12-12 acting through its attorney may join as a plaintiff in any suit
12-13 brought by the attorney general to seek a judgment for delinquent
12-14 taxes and penalties due to the municipality under this chapter.
12-15 (b) A municipality may bring suit for the collection of
12-16 taxes owed to the municipality under this chapter if:
12-17 (1) the taxes are certified by the comptroller in the
12-18 notice required by Section 353.302(d);
12-19 (2) a written notice of the tax delinquency and the
12-20 municipality's intention to bring suit is given by certified mail
12-21 to the taxpayer, the attorney general, and the comptroller at least
12-22 60 days before the suit is filed; and
12-23 (3) neither the comptroller nor the attorney general
12-24 disapproves of the suit.
12-25 Sec. 353.310. DISAPPROVAL OF MUNICIPAL SUIT. (a) The
13-1 comptroller or the attorney general may disapprove of the
13-2 institution of a suit by a municipality under Section 353.309(b)
13-3 if:
13-4 (1) negotiations between the state and the taxpayer
13-5 are being conducted for the purpose of the collection of delinquent
13-6 taxes owed to the state and the municipality seeking to bring suit;
13-7 (2) the taxpayer owes substantial taxes to the state
13-8 and there is a reasonable possibility that the taxpayer may be
13-9 unable to pay the total amount owed;
13-10 (3) the state will bring suit against the taxpayer for
13-11 all taxes due under Chapter 152 and this chapter; or
13-12 (4) the suit involves a critical legal question
13-13 relating to the interpretation of state law or a provision of the
13-14 Texas or United States constitution in which the state has an
13-15 overriding interest.
13-16 (b) A notice of disapproval to a municipality must be in
13-17 writing and give the reason for the determination by the
13-18 comptroller or attorney general.
13-19 (c) A disapproval is final and not subject to review.
13-20 (d) Not earlier than one year after the date of a
13-21 disapproval of the institution of a municipal collection suit, the
13-22 municipality may again proceed as provided by Section 353.309(b)
13-23 even though the liability of the taxpayer includes taxes for which
13-24 the municipality has previously given notice and the comptroller or
13-25 attorney general has disapproved of the suit.
14-1 Sec. 353.311. JUDGMENTS IN MUNICIPAL SUIT. (a) A judgment
14-2 in a suit under Section 353.309(b) for or against a taxpayer does
14-3 not affect a claim against the taxpayer by another municipality or
14-4 the state unless the state is party to the suit.
14-5 (b) A municipality shall abstract a copy of each final
14-6 judgment for taxes imposed under this chapter in a case in which
14-7 the state is not a party and shall send to the comptroller a copy
14-8 of the judgment and the abstract.
14-9 (c) A municipality shall by execution collect the taxes
14-10 awarded to it in each judgment received by the municipality and is
14-11 responsible for the renewal of the judgment before its expiration.
14-12 (d) The municipality shall notify the comptroller by
14-13 certified mail of the amount of any taxes collected on the
14-14 judgment.
14-15 SUBCHAPTER E. REVENUE DEPOSIT AND DISTRIBUTION
14-16 Sec. 353.401. COLLECTIONS HELD BY COMPTROLLER. The
14-17 comptroller shall deposit, hold, account for, and transmit the
14-18 taxes collected by the comptroller under this chapter for each
14-19 municipality in the same manner as required under Section 321.501.
14-20 Sec. 353.402. DISTRIBUTION OF TRUST FUNDS. At least twice
14-21 during each state fiscal year and at other times as often as
14-22 feasible, the comptroller shall send to the municipal treasurer or
14-23 to the person who performs the office of the municipal treasurer
14-24 payable to the municipality the municipality's share of the taxes
14-25 collected by the comptroller under this chapter.
15-1 Sec. 353.403. STATE'S SHARE. Before sending any money to a
15-2 municipality under this subchapter, the comptroller shall deduct
15-3 two percent of the amount of the taxes collected within the
15-4 municipality during the period for which a distribution is made as
15-5 the state's charge for its services under this chapter and shall
15-6 credit the money deducted to the general revenue fund.
15-7 Sec. 353.404. AMOUNTS RETAINED IN TRUST ACCOUNT. (a) The
15-8 comptroller may retain in the suspense account of a municipality a
15-9 portion of the municipality's share of the tax collected for the
15-10 municipality under this chapter, not to exceed five percent of the
15-11 amount remitted to the municipality. If the municipality has
15-12 abolished the tax, the amount that may be retained may not exceed
15-13 five percent of the final remittance to the municipality at the
15-14 time of the termination of the collection of the tax.
15-15 (b) From the amounts retained in a municipality's suspense
15-16 account, the comptroller may make refunds for overpayments to the
15-17 account and to redeem dishonored checks and drafts deposited to the
15-18 credit of the account.
15-19 (c) Before the expiration of one year after the effective
15-20 date of the abolition of a municipality's tax under this chapter
15-21 the comptroller shall send to the municipality the remainder of the
15-22 money in the municipality's account and shall close the account.
15-23 Sec. 353.405. INTEREST ON TRUST ACCOUNT. Interest earned on
15-24 all deposits made with the state treasurer under Section 353.401,
15-25 including interest earned from retained suspense accounts, shall be
16-1 credited to the general revenue fund.
16-2 SECTION 2. The importance of this legislation and the
16-3 crowded condition of the calendars in both houses create an
16-4 emergency and an imperative public necessity that the
16-5 constitutional rule requiring bills to be read on three several
16-6 days in each house be suspended, and this rule is hereby suspended.