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A BILL TO BE ENTITLED
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AN ACT
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relating to imposing a local tax on the sale or lease of a new luxury |
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motor vehicle in certain areas. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Subtitle C, Title 3, Tax Code, is amended by |
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adding Chapter 328 to read as follows: |
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CHAPTER 328. TAX ON SALE OR LEASE OF NEW LUXURY MOTOR VEHICLE IN |
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CERTAIN AREAS |
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Sec. 328.001. DEFINITIONS. (a) In this chapter: |
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(1) "Dealership" has the meaning assigned by Section |
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2301.002, Occupations Code. |
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(2) "Gross sale or lease price" means: |
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(A) the price at which a new luxury motor vehicle |
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and any accessories attached on or before sale is offered for sale, |
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before any discount or trade-in; and |
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(B) the total amount to be paid under a lease |
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agreement for a new luxury motor vehicle, before any discount or |
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trade-in. |
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(3) "Lease" means an agreement, other than a rental, |
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by a franchised dealer to give for longer than 180 days exclusive |
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use of a new luxury motor vehicle to another for consideration. |
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(4) "Lower Rio Grande Valley" means the region |
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included in the Lower Rio Grande Valley Development Council. |
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(5) "New luxury motor vehicle" means a new motor |
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vehicle that has a gross sale or lease price of at least $60,000. |
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(b) Except to the extent of conflict, words used in this |
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chapter and defined by Chapter 152 have the meanings assigned by |
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Chapter 152. |
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Sec. 328.002. TAX IMPOSED; RATE. (a) A tax is imposed on |
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each retail sale or lease of a new luxury motor vehicle by a |
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franchised dealer at a dealership in the Lower Rio Grande Valley. |
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(b) The rate of the tax is 0.2 percent of the gross sale or |
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lease price of the new luxury motor vehicle. |
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Sec. 328.003. APPLICABILITY OF TAX. (a) The tax authorized |
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by this chapter on the sale of a new luxury motor vehicle does not |
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apply to the sale of a new luxury motor vehicle unless the state tax |
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imposed under Chapter 152 also applies. |
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(b) The tax authorized by this chapter on the lease of a new |
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luxury motor vehicle applies to the lease of a new luxury motor |
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vehicle in each situation in which the transaction is not |
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considered a sale for purposes of the imposition of the state tax |
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under Chapter 152. |
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(c) The exemptions provided by Subchapter E, Chapter 152, |
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apply to the tax imposed under this chapter. |
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Sec. 328.004. COLLECTION OF TAX. (a) Each franchised |
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dealer that sells or leases a new luxury motor vehicle at a |
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dealership in the Lower Rio Grande Valley shall collect the tax for |
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the benefit of the municipality or county in which the dealership is |
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located. |
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(b) If the dealership at which the sale or lease occurred is |
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located in a municipality, the franchised dealer shall remit the |
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tax to that municipality as provided by that municipality. If the |
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dealership at which the sale or lease occurred is not located in a |
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municipality, the franchised dealer shall remit the tax to the |
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county in which the dealership is located as provided by that |
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county. |
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(c) The franchised dealer shall add the tax imposed by this |
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chapter and any tax imposed under Chapter 152 to the sale or lease |
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price, and when the taxes are added the total amount is a debt owed |
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to the franchised dealer by the purchaser or lessee until paid. If |
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the total amount is not paid, the unpaid amount is recoverable at |
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law in the same manner the original sale or lease price may be |
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recovered. |
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(d) A municipality or county to which a franchised dealer is |
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required to remit taxes under this chapter shall by ordinance or |
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order prescribe recordkeeping, reporting, and payment requirements |
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and penalties, including interest charges, for failure to keep |
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records required by the municipality or county, to report when |
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required, or to pay the tax when due. The attorney acting for the |
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municipality or county may bring suit against a franchised dealer |
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who fails to collect a tax under this chapter and to pay it over to |
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the municipality or county as required. |
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(e) A municipality by ordinance or a county by order may |
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permit a franchised dealer who is required to collect a tax under |
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this chapter to retain a percentage of the amount collected and |
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required to be reported as reimbursement to the franchised dealer |
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for the costs of collecting the tax. The municipality or county may |
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provide that the franchised dealer may retain the amount only if the |
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person pays the tax and files reports as required by the |
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municipality or county. |
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Sec. 328.005. USE OF REVENUE. A municipality or county may |
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use revenue from the tax imposed under this chapter only to |
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construct or maintain public roadways. |
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SECTION 2. As soon as possible after the effective date of |
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this Act, but not later than December 31, 2017, each municipality |
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and county to which a franchised dealer will be required to remit |
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taxes under Section 328.004(b), Tax Code, as added by this Act, |
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shall adopt any ordinances or orders necessary to govern the |
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collection and enforcement of the tax imposed under Chapter 328, |
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Tax Code, as added by this Act. |
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SECTION 3. This Act applies only to a sale or lease of a new |
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luxury motor vehicle in the Lower Rio Grande Valley on or after |
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January 1, 2018. A sale or lease that occurs before that date is |
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governed by the law in effect on the date the sale or lease |
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occurred, and that law is continued in effect for that purpose. |
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SECTION 4. This Act takes effect immediately if it receives |
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a vote of two-thirds of all the members elected to each house, as |
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provided by Section 39, Article III, Texas Constitution. If this |
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Act does not receive the vote necessary for immediate effect, this |
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Act takes effect September 1, 2017. |