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BILL AS INTRODUCED 2007-2008

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H.289

Introduced by Representative Obuchowski of Rockingham

Referred to Committee on

Date:

Subject:  Taxation; purchase and use tax; exemption for low-priced cars

Statement of purpose:  This bill proposes to provide a tax exemption for the purchase price on any car with a Blue Book value of less than $1,000.00.

AN ACT RELATING TO PURCHASE AND USE TAX EXEMPTION FOR LOW-PRICED CARS

It is hereby enacted by the General Assembly of the State of Vermont:

Sec. 1.  32 V.S.A. § 8902(5) is amended to read:

(5)  “Taxable cost” — the purchase price as defined in subdivision (4) of this section or the taxable cost as determined under section 8907 of this title.

(A)  For any purchaser who has paid tax on the purchase or use of a motor vehicle that was sold or traded by the purchaser or for which the purchaser received payment under a contract of insurance, the taxable cost of the replacement motor vehicle other than a leased vehicle shall exclude:

(A)(i)  the value allowed by the seller on any motor vehicle accepted by him as part of the consideration of the motor vehicle, provided the motor vehicle accepted by the seller is owned and previously or currently registered by the purchaser, with no change of ownership since registration, except for motor vehicles for which registration is not required under the provisions of Title 23 or motor vehicles received under the provisions of subdivision 8911(8) of this title;

(B)(ii)  the amount received from the sale of a motor vehicle last registered in his or her name, the amount not to exceed the average book value of the same make, type, model, and year of manufacture as designated by the manufacturer and as shown in the Official Used Car Guide, National Automobile Dealers Association (New England edition), or any comparable publication, provided such sale occurs within three months of the taxable purchase.  Such amount shall be reported on forms supplied by the commissioner of motor vehicles;

(C)(iii)  the amount actually paid to the purchaser within three months prior to the taxable purchase by any insurer under a contract of collision, comprehensive or similar insurance with respect to a motor vehicle owned by him or her, provided that the vehicle is not subject to the tax imposed by 32 V.S.A. § subsection 8903(d) of this title and provided that one of these events occur occurs:

(i)(I)  the motor vehicle with respect to which such payment is made by the insurer is accepted by the seller as a trade-in on the purchased motor vehicle before the repair of the damage giving rise to insurer’s payment,; or

(ii)(II)  the motor vehicle with respect to which such payment is made to the insurer is treated as a total loss and is sold for dismantling;

(D)(iv)  a purchaser shall be entitled to a partial or complete refund of taxes paid under 32 V.S.A. § subsection 8903(a) or (b) of this title if an insurer makes a payment to him or her under contract of collision, comprehensive or similar insurance after he or she has paid the tax imposed by this chapter if such payment by the insurer is either:

(i)(I)  on account of damages to a motor vehicle which was accepted by seller as a trade-in on the purchased vehicle before repairs of the damage giving rise to the insurer’s payment,; or

(ii)(II)  on account of damages for the total destruction of a vehicle arising from an accident which occurred within three months prior to the taxable purchase.;

(E)(v)  the purchase price of a motor vehicle subject to the tax imposed by 32 V.S.A. § subsections 8903(a) and (b) of this title shall not be reduced by the value received or allowed in connection with the transfer of a vehicle which was registered for use as a short-term rental vehicle.;

(F)(vi)  notwithstanding any other provision of law, for leases in effect on June 30, 1995, no portion of the purchase and use tax paid at the time of lease shall be refunded; provided, however, for leases in effect on June 30, 1995, if the lessee purchases the leased vehicle, no tax shall be imposed on that purchase.

(B)  If the value as determined under section 8907 of this title is less than $1,000.00, the taxable cost of the vehicle shall be zero.

Sec. 2.  EFFECTIVE DATE

     This act shall apply to purchases on or after July 1, 2007.



Published by:

The Vermont General Assembly
115 State Street
Montpelier, Vermont


www.leg.state.vt.us