1-1 By: Carona S.B. No. 248 1-2 (In the Senate - Filed January 16, 2001; January 17, 2001, 1-3 read first time and referred to Committee on Finance; 1-4 April 24, 2001, reported adversely, with favorable Committee 1-5 Substitute by the following vote: Yeas 12, Nays 0; April 24, 2001, 1-6 sent to printer.) 1-7 COMMITTEE SUBSTITUTE FOR S.B. No. 248 By: Whitmire 1-8 A BILL TO BE ENTITLED 1-9 AN ACT 1-10 relating to the exemption from ad valorem taxation of motor 1-11 vehicles leased for personal use. 1-12 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-13 SECTION 1. Subchapter B, Chapter 11, Tax Code, is amended by 1-14 adding Section 11.252 to read as follows: 1-15 Sec. 11.252. MOTOR VEHICLES LEASED FOR PERSONAL USE. 1-16 (a) The owner of a motor vehicle that is subject to a lease is 1-17 entitled to an exemption from taxation of the vehicle if: 1-18 (1) the lessee does not hold the vehicle for the 1-19 production of income; and 1-20 (2) the vehicle is used primarily for activities that 1-21 do not involve the production of income. 1-22 (b) For purposes of this section, a motor vehicle is used 1-23 primarily for activities that do not involve the production of 1-24 income if more than 50 percent of the use of the vehicle is for 1-25 those activities. 1-26 (c) The comptroller by rule shall establish exemption 1-27 application requirements and appropriate procedures to determine 1-28 whether a motor vehicle subject to a lease qualifies for an 1-29 exemption under Subsection (a). 1-30 (d) In connection with the requirements and procedures under 1-31 Subsection (c), the comptroller by rule shall adopt a form to be 1-32 completed by the lessee of a motor vehicle for which the owner of 1-33 the vehicle may apply for an exemption under Subsection (a). The 1-34 form shall require the lessee to provide the lessee's name, 1-35 address, and driver's license or personal identification 1-36 certificate number and to certify under oath that the lessee does 1-37 not hold the vehicle for the production of income and that the 1-38 vehicle is used primarily for activities that do not involve the 1-39 production of income. The comptroller shall include on the form a 1-40 notice of the penalties prescribed by Section 37.10, Penal Code, 1-41 for making a false statement on the form. 1-42 (e) The owner of a motor vehicle that is subject to a lease 1-43 shall maintain the form completed by the lessee of the vehicle and 1-44 make the form available for inspection and copying by the chief 1-45 appraiser of the applicable appraisal district at all reasonable 1-46 times. If the owner does not maintain a completed form relating to 1-47 the vehicle, the owner: 1-48 (1) must render the vehicle for taxation in the 1-49 applicable rendition statement or property report filed by the 1-50 owner under Chapter 22; and 1-51 (2) may not file an application for an exemption under 1-52 Subsection (a) for the vehicle. 1-53 (f) The governing body of a municipality by ordinance 1-54 adopted before January 1, 2002, may provide for the taxation of 1-55 leased motor vehicles otherwise exempted under Subsection (a). If 1-56 the governing body of a municipality provides for the taxation of 1-57 leased motor vehicles under this subsection, the exemption provided 1-58 by Subsection (a) does not apply to that municipality. 1-59 (g) If not continued in effect by the legislature, this 1-60 section expires December 31, 2003. 1-61 (h) In this section: 1-62 (1) "Lease" has the meaning assigned by Section 1-63 152.001(6). 1-64 (2) "Motor vehicle" means a passenger car or truck 2-1 with a shipping weight of not more than 9,000 pounds. 2-2 SECTION 2. This Act takes effect January 1, 2002, and 2-3 applies only to ad valorem taxes imposed on a motor vehicle that is 2-4 subject to a lease entered into on or after January 2, 2001. 2-5 * * * * *