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ARIZONA HOUSE OF REPRESENTATIVESFifty-sixth Legislature First Regular Session |
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HB 2447: TPT; exemption; motor vehicle manufacturers
Sponsor: Representative Martinez, LD 16
Committee on Appropriations
Overview
Permits a manufacturer or new dealer that is owned, operated or controlled by the manufacturer or one of its affiliates or subsidiaries to issue a special 10-day non-resident registration permit for non-residents purchasing an unregistered vehicle in this state to be taken out of the state. Exempts the sale of motor vehicles to non-residents of this state by a manufacturer or new dealer from the Transaction Privilege Tax (TPT), sales or other similar tax if the non-resident purchaser has obtained a special 10-day non-resident registration permit.
History
A non-resident who purchases an unregistered vehicle in this state for removal from this state to the purchaser's state of residence must obtain a special 90-day non-resident registration permit for the vehicle. The non-resident will obtain the 90-day special permit by applying to the Arizona Department of Transportation (ADOT), to an authorized third party or motor vehicle dealer. The non-resident must pay a $15 fee for each special 90-day non-resident registration. An affidavit in a form prescribed by the Director of ADOT must accompany the application and contain the following statements:
1) the purchaser is not a resident of this state. The non-resident is required to present to ADOT, the authorized third-party or vehicle dealer a driver's license or other evidence prescribed by ADOT's director showing that the purchaser is not a resident of this state;
2) the vehicle is purchased to be registered out of the state within 90-days after the issuance of the special permit;
3) the vehicle is not purchased for transfer to a resident of this state; and
4) other information the director of ADOT deems necessary.
At the time of application for a special 90-day non-resident registration permit, the non-resident must submit proper evidence of ownership of the vehicle. The special 90-day non-resident registration permit is only valid for 90 days from the date of issuance and will be in the form prescribed by the Director of ADOT. (A.R.S. §§ 28-2003, 28-2154).
The sale of motor vehicles to non-residents of this state for use outside this state is exempt from TPT, sales or another similar tax if:
1) the motor vehicle dealer ships or delivers the motor vehicle to a destination outside this state; and
2) the vehicle, trailer or semitrailer has a gross vehicle weight of more than 10,000 pounds and is used or maintained to transport property in the furtherance of interstate commerce or otherwise meets the definition of commercial motor vehicle (A.R.S. § 42-6004)
A Joint Legislative Budget Committee (JLBC) fiscal note for this act estimates the loss of current revenues to be minimal, since the primary Arizona-based manufacturer currently delivers its vehicles to out-of-state purchasers, and those sales are already exempt from TPT. If the Arizona-based manufacturer begins to permit the drive-outs allowed by the 10-day non-resident registration permit, the JLBC estimates the state would incur a forgone revenue loss of between $0 to $2.6 million.
Provisions
1. Allows a manufacturer or new dealer that is owned, operated or controlled by the manufacturer or one of its affiliates or subsidiaries (new dealer) to issue a special 10-day non-resident registration permit (Sec. 3)
2. Requires the manufacturer or new dealer to send an electronic record of a 10-day non-resident registration permit to ADOT. (Sec. 3)
3. Restricts a manufacturer or new dealer from issuing a 10-day non-resident registration permit unless the permit is recorded in ADOT's electronic records. (Sec. 3)
4. Exempts the sale of motor vehicles to non-residents of this state if the manufacturer or new dealer ships or delivers the motor vehicle to a destination outside the state or the non-resident purchaser has obtained a 10-day non-resident registration permit from the TPT, sales or other similar tax. (Sec. 5)
5. Prohibits a manufacturer, new dealer or one of its affiliates from issuing, assigning or delivering a 10-day non-resident registration permit to any person unless the person:
a) obtains the 10-day non-resident registration permit following requirements outlined in statute;
b) completes the affidavit required to accompany the permit application in a form prescribed by the director of ADOT or the form prescribed by the Department of Revenue (DOR) for the certificate used to establish the satisfaction of the criteria necessary to qualify for the sale of a motor vehicle;
c) presents a current valid driver's license issued by another state containing an address outside of this state to the manufacturer or new dealer;
d) provides any other information reasonably and uniformly required by ADOT; and
e) for FY 24, issue not more than 500 10-day non-resident registration permits, the limit increases by 10% each FY thereafter. (Sec. 3)
6. Directs the manufacturer or new dealer that issues a 10-day non-resident registration permit to affix or insert on the face of each permit the dates of issuance and expiration and the make and vehicle identification number of the vehicle. The permit is prohibited from having the name or address of the person who purchased the vehicle in a position that is legible from outside the vehicle. (Sec. 3)
7. Requires a manufacturer or new dealer that issues 10-day non-resident registration permits to maintain a record in a form prescribed by the director of ADOT of all 10-day non-resident registration permits issued by the manufacturer or new dealer and a record of other information on the issuance of the permits that ADOT or DOR requires. (Sec. 3)
8. Stipulates that the manufacturer or new dealer must keep each record for at least three years after the date of entry of the record (Sec. 3)
9. Instructs the manufacturer or new dealer to allow the directors of ADOT or DOR full and free access to the records during regular business hours. (Sec. 3)
10. Specifies the electronic record is written notice of the removal of the vehicle from this state for use in the purchaser's state of residence and relives the dealer or authorized third party of liability. (Sec. 3)
11. States that if a purchaser registers the vehicle in this state 365 days after the issuance of the 10-day non-resident registration permits, the purchaser is liable in an amount equal to any tax, penalty and interest that the dealer or authorized third party would have been required to pay under applicable law. (sec. 3)
12. Requires a manufacturer or new dealer to inform the purchaser in writing the purchaser's liability at the time the 10-day non-resident registration permit is issued. (Sec. 3)
13. Specifies subsequent registration or use of the vehicle in this state does not create a cause of action against a dealer or authorized third party that complied with applicable law. (Sec. 3)
14. Directs ADOT and DOR to jointly develop and prescribe forms for the manufacturer or new dealer and the purchaser to complete for the proper administration and enforcement of this act. (Sec. 3)
15. States that compliance with this act allows delivery of the vehicle to a non-resident purchaser in this state and retains the applicable deductions. (Sec. 3)
16. Permits a non-resident who purchases an unregistered vehicle in this state from the manufacturer or new dealer to purchase a 10-day non-resident registration permit (Sec. 2)
17. Stipulates the non-resident must apply to the manufacturer or new dealer for a 10-day non-resident registration permit. (Sec. 2)
18. Requires an affidavit accompanying the non-resident registration permit application to state that the vehicle is purchased to be registered out of state within 10 days after the issuance of the 10-day non-resident registration permit. (Sec. 2)
19. Outlines requirements for a 10-day non-resident permit application. (Sec. 2)
20. States a 10-day non-resident registration permit is valid for only 10 days from the date of issuance and will be in a form prescribed by the director of ADOT. (Sec. 2)
21.
Authorizes ADOT to establish a fee by
rule for a 10-day non-resident registration permit. (Sec. 1)
22. States that sales of a motor vehicle if the manufacturer or new dealer ships or delivers the motor vehicle to a destination outside the state or the non-resident purchaser has obtained a 10-day non-resident registration permit are not included in the TPT tax base. (Sec. 4)
23. States this act applies to taxable periods beginning on or after the first day of the month following the general effective date. (Sec. 6
24. Makes technical and conforming changes. (Sec. 1, 4-5)
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HB 2447
Initials JB Page 0 Appropriations
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