By Sadler                                             H.B. No. 2866
         77R3914 DAK-D                           
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to exempting boats and motors purchased exclusively for
 1-3     rental from the sales and use tax on boats and motors.
 1-4           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-5           SECTION 1. Section 160.024, Tax Code, is amended to read as
 1-6     follows:
 1-7           Sec. 160.024.  EXEMPTIONS [EXEMPTION].  The taxes imposed by
 1-8     this chapter do not apply to the sale of a taxable boat or motor or
 1-9     to the use of a taxable boat or motor:
1-10                 (1)  by this state or its political subdivisions or the
1-11     federal government; or
1-12                 (2)  by a purchaser who exclusively uses the boat or
1-13     motor for rental to others.
1-14           SECTION 2.  (a)  This Act takes effect immediately if it
1-15     receives a vote of two-thirds of all the members elected to each
1-16     house, as provided by Section 39, Article III, Texas Constitution.
1-17     If this Act does not receive the vote necessary for immediate
1-18     effect, this Act takes effect September 1, 2001.
1-19           (b)  The change in law made by this Act does not affect taxes
1-20     imposed before the effective date of this Act, and the law in
1-21     effect before the effective date of this Act is continued in effect
1-22     for purposes of the liability for and collection of those taxes.