86R2677 TJB-D
By: Bettencourt, Creighton, Paxton S.B. No. 1005
A BILL TO BE ENTITLED
AN ACT
relating to the number of days that certain tangible personal
property that is exempt from ad valorem taxation due to its location
in this state for a temporary period may be located in this state
for the purpose of qualifying for the tax exemption.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Sections 11.251(e), (g), and (k), Tax Code, are
amended to read as follows:
(e) In determining the market value of freeport goods that
in the preceding year were assembled, manufactured, repaired,
maintained, processed, or fabricated in this state or used by the
person who acquired or imported the property in the repair or
maintenance of aircraft operated by a certificated air carrier, the
chief appraiser shall exclude the cost of equipment, machinery, or
materials that entered into and became component parts of the
freeport goods but were not themselves freeport goods or that were
not transported outside the state before the expiration of 365
[175] days, or, if applicable, the greater number of days adopted by
the taxing unit as authorized by Subsection (l), after they were
brought into this state by the property owner or acquired by the
property owner in this state. For component parts held in bulk, the
chief appraiser may use the average length of time a component part
was held in this state by the property owner during the preceding
year in determining whether the component parts were transported
out of this state before the expiration of 365 [175] days or, if
applicable, the greater number of days adopted by the taxing unit as
authorized by Subsection (l).
(g) If the property owner or the chief appraiser
demonstrates that the method provided by Subsection (d)
significantly understates or overstates the market value of the
property qualified for an exemption under Subsection (b) in the
current year, the chief appraiser shall determine the market value
of the freeport goods to be exempt by determining, according to the
property owner's records and any other available information, the
market value of those freeport goods owned by the property owner on
January 1 of the current year, excluding the cost of equipment,
machinery, or materials that entered into and became component
parts of the freeport goods but were not themselves freeport goods
or that were not transported outside the state before the
expiration of 365 [175] days, or, if applicable, the greater number
of days adopted by the taxing unit as authorized by Subsection (l),
after they were brought into this state by the property owner or
acquired by the property owner in this state.
(k) Property that meets the requirements of Article VIII,
Sections 1-j(a)(1) and (2), of the Texas Constitution and that is
transported outside of this state not later than 365 [175] days, or,
if applicable, the greater number of days adopted by the taxing unit
as authorized by Subsection (l), after the date the person who owns
it on January 1 acquired it or imported it into this state is
freeport goods regardless of whether the person who owns it on
January 1 is the person who transports it outside of this state.
SECTION 2. This Act applies only to a tax year beginning on
or after the effective date of this Act.
SECTION 3. This Act takes effect January 1, 2020, but only
if the constitutional amendment proposed by the 86th Legislature,
Regular Session, 2019, to extend the number of days that certain
tangible personal property that is exempt from ad valorem taxation
due to its location in this state for a temporary period may be
located in this state for the purpose of qualifying for the tax
exemption is approved by the voters. If that amendment is not
approved by the voters, this Act has no effect.