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A BILL TO BE ENTITLED
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AN ACT
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relating to the exemption from ad valorem taxation of certain |
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tangible personal property stored temporarily at a location in this |
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state. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Subsection (a), Section 11.253, Tax Code, is |
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amended by amending Subdivision (2) and adding Subdivisions (5) and |
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(6) to read as follows: |
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(2) "Goods-in-transit" means tangible personal |
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property that: |
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(A) is acquired in or imported into this state to |
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be forwarded to another location in this state or outside this |
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state; |
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(B) is stored under a contract of bailment by a |
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public warehouse operator [detained] at one or more public |
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warehouse facilities [a location] in this state that are not in any |
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way owned or controlled by [in which] the owner of the personal |
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property [does not have a direct or indirect ownership interest] |
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for the account of [assembling, storing, manufacturing,
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processing, or fabricating purposes by] the person who acquired or |
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imported the property; |
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(C) is transported to another location in this |
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state or outside this state not later than 175 days after the date |
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the person acquired the property in or imported the property into |
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this state; and |
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(D) does not include oil, natural gas, petroleum |
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products, aircraft, dealer's motor vehicle inventory, dealer's |
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vessel and outboard motor inventory, dealer's heavy equipment |
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inventory, or retail manufactured housing inventory. |
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(5) "Bailee" and "warehouse" have the meanings |
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assigned by Section 7.102, Business & Commerce Code. |
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(6) "Public warehouse operator" means a person that: |
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(A) is both a bailee and a warehouse; and |
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(B) stores under a contract of bailment, at one |
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or more public warehouse facilities, tangible personal property |
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that is owned by other persons solely for the account of those |
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persons and not for the operator's account. |
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SECTION 2. Section 11.253, Tax Code, is amended by amending |
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Subsections (e) and (h) and adding Subsections (j-1) and (j-2) to |
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read as follows: |
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(e) In determining the market value of goods-in-transit |
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that in the preceding year were [assembled,] stored[, manufactured,
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processed, or fabricated] in this state, the chief appraiser shall |
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exclude the cost of equipment, machinery, or materials that entered |
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into and became component parts of the goods-in-transit but were |
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not themselves goods-in-transit or that were not transported to |
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another location in this state or outside this state before the |
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expiration of 175 days after the date they were brought into this |
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state by the property owner or acquired by the property owner in |
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this state. For component parts held in bulk, the chief appraiser |
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may use the average length of time a component part was held by the |
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owner of the component parts during the preceding year at a location |
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in this state that was not owned by or under the control of the owner |
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of the component parts in determining whether the component parts |
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were transported to another location in this state or outside this |
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state before the expiration of 175 days. |
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(h) The chief appraiser by written notice delivered to a |
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property owner who claims an exemption under this section may |
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require the property owner to provide copies of property records so |
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the chief appraiser can determine the amount and value of |
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goods-in-transit and that the location in this state where the |
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goods-in-transit were detained for storage [assembling, storing,
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manufacturing, processing, or fabricating purposes] was not owned |
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by or under the control of the owner of the goods-in-transit. If |
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the property owner fails to deliver the information requested in |
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the notice before the 31st day after the date the notice is |
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delivered to the property owner, the property owner forfeits the |
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right to claim or receive the exemption for that year. |
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(j-1) Notwithstanding Subsection (j) or official action |
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that was taken under that subsection before September 1, 2011, to |
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tax goods-in-transit exempt under Subsection (b) and not exempt |
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under other law, a taxing unit may not tax such goods-in-transit in |
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a tax year that begins on or after January 1, 2012, unless the |
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governing body of the taxing unit takes action on or after September |
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1, 2011, in the manner required for official action by the governing |
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body, to provide for the taxation of the goods-in-transit. The |
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official action to tax the goods-in-transit must be taken before |
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January 1 of the first tax year in which the governing body proposes |
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to tax goods-in-transit. Before acting to tax the exempt property, |
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the governing body of the taxing unit must conduct a public hearing |
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as required by Section 1-n(d), Article VIII, Texas Constitution. |
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If the governing body of a taxing unit provides for the taxation of |
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the goods-in-transit as provided by this subsection, the exemption |
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prescribed by Subsection (b) does not apply to that unit. The |
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goods-in-transit remain subject to taxation by the taxing unit |
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until the governing body of the taxing unit, in the manner required |
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for official action, rescinds or repeals its previous action to tax |
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goods-in-transit or otherwise determines that the exemption |
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prescribed by Subsection (b) will apply to that taxing unit. |
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(j-2) Notwithstanding Subsection (j-1), if under Subsection |
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(j) the governing body of a taxing unit, before September 1, 2011, |
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took action to provide for the taxation of goods-in-transit and |
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pledged the taxes imposed on the goods-in-transit for the payment |
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of a debt of the taxing unit, the tax officials of the taxing unit |
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may continue to impose the taxes against the goods-in-transit until |
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the debt is discharged, if cessation of the imposition would impair |
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the obligation of the contract by which the debt was created. |
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SECTION 3. Subdivision (2), Subsection (a), Section 11.253, |
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Tax Code, as amended by this Act, applies only to an ad valorem tax |
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year that begins on or after January 1, 2012. |
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SECTION 4. (a) Except as provided by Subsection (b) of |
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this section, this Act takes effect January 1, 2012. |
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(b) Section 2 of this Act takes effect September 1, 2011. |