| 1 | 1 | | 86R2677 TJB-D |
|---|
| 2 | 2 | | By: Bettencourt, Creighton, Paxton S.B. No. 1005 |
|---|
| 3 | 3 | | |
|---|
| 4 | 4 | | |
|---|
| 5 | 5 | | A BILL TO BE ENTITLED |
|---|
| 6 | 6 | | AN ACT |
|---|
| 7 | 7 | | relating to the number of days that certain tangible personal |
|---|
| 8 | 8 | | property that is exempt from ad valorem taxation due to its location |
|---|
| 9 | 9 | | in this state for a temporary period may be located in this state |
|---|
| 10 | 10 | | for the purpose of qualifying for the tax exemption. |
|---|
| 11 | 11 | | BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
|---|
| 12 | 12 | | SECTION 1. Sections 11.251(e), (g), and (k), Tax Code, are |
|---|
| 13 | 13 | | amended to read as follows: |
|---|
| 14 | 14 | | (e) In determining the market value of freeport goods that |
|---|
| 15 | 15 | | in the preceding year were assembled, manufactured, repaired, |
|---|
| 16 | 16 | | maintained, processed, or fabricated in this state or used by the |
|---|
| 17 | 17 | | person who acquired or imported the property in the repair or |
|---|
| 18 | 18 | | maintenance of aircraft operated by a certificated air carrier, the |
|---|
| 19 | 19 | | chief appraiser shall exclude the cost of equipment, machinery, or |
|---|
| 20 | 20 | | materials that entered into and became component parts of the |
|---|
| 21 | 21 | | freeport goods but were not themselves freeport goods or that were |
|---|
| 22 | 22 | | not transported outside the state before the expiration of 365 |
|---|
| 23 | 23 | | [175] days, or, if applicable, the greater number of days adopted by |
|---|
| 24 | 24 | | the taxing unit as authorized by Subsection (l), after they were |
|---|
| 25 | 25 | | brought into this state by the property owner or acquired by the |
|---|
| 26 | 26 | | property owner in this state. For component parts held in bulk, the |
|---|
| 27 | 27 | | chief appraiser may use the average length of time a component part |
|---|
| 28 | 28 | | was held in this state by the property owner during the preceding |
|---|
| 29 | 29 | | year in determining whether the component parts were transported |
|---|
| 30 | 30 | | out of this state before the expiration of 365 [175] days or, if |
|---|
| 31 | 31 | | applicable, the greater number of days adopted by the taxing unit as |
|---|
| 32 | 32 | | authorized by Subsection (l). |
|---|
| 33 | 33 | | (g) If the property owner or the chief appraiser |
|---|
| 34 | 34 | | demonstrates that the method provided by Subsection (d) |
|---|
| 35 | 35 | | significantly understates or overstates the market value of the |
|---|
| 36 | 36 | | property qualified for an exemption under Subsection (b) in the |
|---|
| 37 | 37 | | current year, the chief appraiser shall determine the market value |
|---|
| 38 | 38 | | of the freeport goods to be exempt by determining, according to the |
|---|
| 39 | 39 | | property owner's records and any other available information, the |
|---|
| 40 | 40 | | market value of those freeport goods owned by the property owner on |
|---|
| 41 | 41 | | January 1 of the current year, excluding the cost of equipment, |
|---|
| 42 | 42 | | machinery, or materials that entered into and became component |
|---|
| 43 | 43 | | parts of the freeport goods but were not themselves freeport goods |
|---|
| 44 | 44 | | or that were not transported outside the state before the |
|---|
| 45 | 45 | | expiration of 365 [175] days, or, if applicable, the greater number |
|---|
| 46 | 46 | | of days adopted by the taxing unit as authorized by Subsection (l), |
|---|
| 47 | 47 | | after they were brought into this state by the property owner or |
|---|
| 48 | 48 | | acquired by the property owner in this state. |
|---|
| 49 | 49 | | (k) Property that meets the requirements of Article VIII, |
|---|
| 50 | 50 | | Sections 1-j(a)(1) and (2), of the Texas Constitution and that is |
|---|
| 51 | 51 | | transported outside of this state not later than 365 [175] days, or, |
|---|
| 52 | 52 | | if applicable, the greater number of days adopted by the taxing unit |
|---|
| 53 | 53 | | as authorized by Subsection (l), after the date the person who owns |
|---|
| 54 | 54 | | it on January 1 acquired it or imported it into this state is |
|---|
| 55 | 55 | | freeport goods regardless of whether the person who owns it on |
|---|
| 56 | 56 | | January 1 is the person who transports it outside of this state. |
|---|
| 57 | 57 | | SECTION 2. This Act applies only to a tax year beginning on |
|---|
| 58 | 58 | | or after the effective date of this Act. |
|---|
| 59 | 59 | | SECTION 3. This Act takes effect January 1, 2020, but only |
|---|
| 60 | 60 | | if the constitutional amendment proposed by the 86th Legislature, |
|---|
| 61 | 61 | | Regular Session, 2019, to extend the number of days that certain |
|---|
| 62 | 62 | | tangible personal property that is exempt from ad valorem taxation |
|---|
| 63 | 63 | | due to its location in this state for a temporary period may be |
|---|
| 64 | 64 | | located in this state for the purpose of qualifying for the tax |
|---|
| 65 | 65 | | exemption is approved by the voters. If that amendment is not |
|---|
| 66 | 66 | | approved by the voters, this Act has no effect. |
|---|