By: Duncan, Ratliff S.B. No. 1435
A BILL TO BE ENTITLED
AN ACT
1-1 relating to the appraisal and ad valorem taxation of heavy
1-2 equipment.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Subdivisions (2) and (6), Subsection (a), Section
1-5 23.1241, Tax Code, are amended to read as follows:
1-6 (2) "Dealer's heavy equipment inventory" means all
1-7 items of heavy equipment that a dealer holds for sale at retail.
1-8 The term includes items of heavy equipment that are leased but
1-9 subject to a purchase option by the lessee.
1-10 (6) "Heavy equipment" means self-propelled,
1-11 self-powered, or pull-type equipment, including farm equipment or a
1-12 diesel engine or gasoline-powered or natural gas-powered engine,
1-13 that weighs at least 3,000 pounds and is intended to be used for
1-14 agricultural, construction, industrial, maritime, mining, or
1-15 forestry uses. The term does not include a motor vehicle that is
1-16 required by:
1-17 (A) Chapter 501, Transportation Code, to be
1-18 titled; or
1-19 (B) Chapter 502, Transportation Code, to be
1-20 registered.
1-21 SECTION 2. Subsections (b) and (f), Section 23.1241, Tax
1-22 Code, are amended to read as follows:
1-23 (b) For the purpose of the computation of property tax:
1-24 (1)[,] the market value of a dealer's heavy equipment
2-1 inventory on January 1 is the lesser of:
2-2 (A) the total annual sales, less sales to
2-3 dealers, fleet transactions, and subsequent sales, for the 12-month
2-4 period corresponding to the preceding tax year, divided by 12; or
2-5 (B) the total annual sales, less sales to
2-6 dealers, fleet transactions, and subsequent sales, for the 12-month
2-7 period corresponding to the current tax year, divided by 12; and
2-8 (2) a sale is considered to occur when ownership of an
2-9 item of heavy equipment is transferred from the dealer to the
2-10 purchaser.
2-11 (f) The comptroller by rule shall adopt a dealer's heavy
2-12 equipment inventory declaration form. Except as provided by
2-13 Section 23.1242(k), not later than February 1 of each year, or, in
2-14 the case of a dealer who was not in business on January 1, not
2-15 later than 30 days after commencement of business, each dealer
2-16 shall file a declaration with the chief appraiser and file a copy
2-17 with the collector. The declaration is sufficient to comply with
2-18 this subsection if it sets forth:
2-19 (1) the name and business address of each location at
2-20 which the declarant conducts business;
2-21 (2) a statement that the declarant is the owner of a
2-22 dealer's heavy equipment inventory; and
2-23 (3) the market value of the declarant's heavy
2-24 equipment inventory for the current tax year as computed under
2-25 Subsection (b)(1)(A).
2-26 SECTION 3. Subsection (h), Section 23.1242, Tax Code, is
3-1 amended to read as follows:
3-2 (h) A taxing unit shall, on its tax bill prepared for the
3-3 owner of a dealer's heavy equipment inventory, separately itemize
3-4 the taxes levied against the dealer's heavy equipment inventory.
3-5 When the tax bill is prepared for a dealer's heavy equipment
3-6 inventory, the assessor for the taxing unit, or an entity, if any,
3-7 other than the collector, that collects taxes on behalf of the
3-8 taxing unit, shall provide the collector a true and correct copy of
3-9 the tax bill sent to the owner, including taxes levied against the
3-10 dealer's heavy equipment inventory. Immediately on receiving the
3-11 notice required by Section 25.25(n), the [The] collector shall
3-12 apply the money in the owner's escrow account to the taxes imposed
3-13 and deliver a tax receipt to the owner. The collector shall apply
3-14 the amount to each appropriate taxing unit in proportion to the
3-15 amount of taxes levied, and the assessor of each taxing unit shall
3-16 apply the funds received from the collector to the taxes owed by
3-17 the owner.
3-18 SECTION 4. Section 25.25, Tax Code, is amended by adding
3-19 Subsections (n) and (o) to read as follows:
3-20 (n) Before January 20, the chief appraiser shall change the
3-21 appraisal roll to correct the market value of a heavy equipment
3-22 dealer who has filed heavy equipment inventory tax statements for
3-23 the 12-month period corresponding to the current tax year and whose
3-24 market value is determined under Section 23.1241(b)(1)(B). Before
3-25 January 20, the chief appraiser shall notify the collector required
3-26 to administer the provisions of Section 23.1242 and affected taxing
4-1 units of the corrected accounts. Before the 10th day after the end
4-2 of each calendar quarter, the chief appraiser shall submit to the
4-3 appraisal review board and to the board of directors of the
4-4 appraisal district a written report of each change made under this
4-5 subsection. The report must include:
4-6 (1) a description of each property; and
4-7 (2) the name of the owner of that property.
4-8 (o) If the chief appraiser has examined the books and
4-9 records of a heavy equipment dealer whose appraised value is
4-10 determined under Section 23.1241(b)(1)(B) and, on conclusion of the
4-11 examination, has determined that the dealer's market value should
4-12 be corrected, the chief appraiser shall change the appraisal roll
4-13 to reflect the corrected market value.
4-14 SECTION 5. This Act takes effect September 1, 1999, and
4-15 applies to the appraisal of heavy equipment for ad valorem tax
4-16 purposes for each tax year that begins on or after January 1, 1999.
4-17 SECTION 6. The importance of this legislation and the
4-18 crowded condition of the calendars in both houses create an
4-19 emergency and an imperative public necessity that the
4-20 constitutional rule requiring bills to be read on three several
4-21 days in each house be suspended, and this rule is hereby suspended.