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A BILL TO BE ENTITLED
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AN ACT
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relating to the allocation for ad valorem tax purposes of the value |
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of vessels and other watercraft used outside this state. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Sections 21.021(a) and (b), Tax Code, are |
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amended to read as follows: |
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(a) A vessel or other watercraft used as an instrumentality |
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of commerce, [(]as defined by [in] Section 21.031, [21.031(b) of |
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this code)] is taxable pursuant to Section 21.02 [of this code]. |
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(b) A special-purpose vessel or other watercraft not used as |
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an instrumentality of commerce, [(]as defined by [in] Section |
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21.031, [21.031(b) of this code)] is deemed to be located on January |
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1 for more than a temporary period for purposes of Section 21.02 [of |
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this code] in the taxing unit in which it was physically located |
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during the year preceding the tax year. If the vessel or watercraft |
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was physically located in more than one taxing unit during the year |
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preceding the tax year, it is deemed to be located for more than a |
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temporary period for purposes of Section 21.02 [of this code] in the |
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taxing unit in which it was physically located for the longest |
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period during the year preceding the tax year or for 30 days, |
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whichever is longer. If a vessel or other watercraft is not deemed |
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to be located in any taxing unit on January 1 for more than a |
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temporary period pursuant to this subsection, the property is |
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taxable as provided by Subdivisions (2) through (4) of Section |
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21.02 [of this code]. |
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SECTION 2. Section 21.031, Tax Code, is amended by amending |
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Subsection (b) and adding Subsections (b-1), (b-2), (b-3), and (i) |
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to read as follows: |
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(b) The appraisal office shall make the allocation as |
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provided by Subsections (b-1), (b-2), and (b-3). |
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(b-1) Except as provided by Subsection (b-2), the [follows: |
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[(1) The] allocable portion of the total fair market |
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value of a vessel or other watercraft used as an instrumentality of |
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commerce that is taxable in this state is determined by multiplying |
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the total fair market value by a fraction, the numerator of which is |
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the number of miles the vessel or watercraft was operated in this |
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state during the year preceding the tax year and the denominator of |
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which is the total number of miles the vessel or watercraft was |
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operated during the year preceding the tax year. [For purposes of |
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this section, "vessel or other watercraft used as an |
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instrumentality of commerce" means a vessel or other watercraft |
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that is primarily employed in the transportation of cargo, |
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passengers, or equipment, and that is economically employed when it |
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is moving from point to point as a means of transportation.] |
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(b-2) This subsection applies only to a property owner that |
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operates a fleet of vessels or other watercraft used as |
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instrumentalities of commerce and that elects in writing submitted |
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to the appraisal office to have the appraisal office make the |
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allocation under this subsection. The allocable portion of the |
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total fair market value of a vessel or other watercraft used as an |
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instrumentality of commerce that is taxable in this state is |
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determined by multiplying the total fair market value of all |
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vessels or other watercraft of the property owner's fleet that are |
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taxable in this state by a fraction, the numerator of which is the |
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number of miles that all the vessels or watercraft of the fleet |
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operated in this state during the year preceding the tax year and |
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the denominator of which is the total number of miles that all the |
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vessels or watercraft of the fleet were operated during the year |
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preceding the tax year. |
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(b-3) [(2)] The allocable portion of the total fair market |
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value of a special-purpose vessel or other watercraft not used as an |
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instrumentality of commerce is determined by multiplying the total |
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fair market value by a fraction, the numerator of which is the |
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number of days the vessel or watercraft was physically located in |
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this state during the year preceding the tax year and the |
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denominator of which is 365. [For purposes of this section, |
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"special-purpose vessel or other watercraft not used as an |
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instrumentality of commerce" means a vessel or other watercraft |
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that: |
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[(A) is designed to be transient and customarily |
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is moved from location to location on a more or less regular basis; |
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[(B) is economically employed when operated in a |
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localized area or in a fixed place; and |
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[(C) is not primarily employed to transport cargo, |
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passengers, and equipment but rather to perform some specialized |
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function or operation not requiring constant movement from point to |
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point.] |
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(i) For purposes of this section: |
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(1) "Special-purpose vessel or other watercraft not |
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used as an instrumentality of commerce" means a vessel or other |
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watercraft that: |
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(A) is designed to be transient and customarily |
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is moved from location to location on a more or less regular basis; |
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(B) is economically employed when operated in a |
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localized area or in a fixed place; and |
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(C) is not primarily employed to transport cargo, |
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passengers, and equipment but rather to perform some specialized |
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function or operation not requiring constant movement from point to |
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point. |
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(2) "Vessel or other watercraft used as an |
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instrumentality of commerce" means a vessel or other watercraft |
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that is primarily employed in the transportation of cargo, |
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passengers, or equipment, and that is economically employed when it |
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is moving from point to point as a means of transportation. |
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SECTION 3. The change in law made by this Act applies only |
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to the allocation of the value of vessels and other watercraft for |
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ad valorem tax purposes beginning on or after the effective date of |
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this Act. |
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SECTION 4. This Act takes effect January 1, 2022. |