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H.B. 41






Chief Sponsor: Patrick Painter

Senate Sponsor: Curtis S. Bramble

             8      LONG TITLE
             9      Committee Note:
             10          The Revenue and Taxation Interim Committee recommended this bill.
             11      General Description:
             12          This bill adjusts a property tax exemption for business personal property.
             13      Highlighted Provisions:
             14          This bill:
             15          .    increases and expands a property tax exemption for business personal property; and
             16          .    makes technical and conforming changes.
             17      Money Appropriated in this Bill:
             18          None
             19      Other Special Clauses:
             20          This bill takes effect on January 1, 2013.
             21      Utah Code Sections Affected:
             22      AMENDS:
             23          59-2-1115, as last amended by Laws of Utah 2008, Chapters 61 and 382
             25      Be it enacted by the Legislature of the state of Utah:
             26          Section 1. Section 59-2-1115 is amended to read:
             27           59-2-1115. Exemption of certain tangible personal property.

             28          (1) For purposes of this section:
             29          (a) (i) "Acquisition cost" means all costs required to put an item of tangible personal
             30      property into service; and
             31          (ii) includes:
             32          (A) the purchase price for a new or used item;
             33          (B) the cost of freight and shipping;
             34          (C) the cost of installation, engineering, erection, or assembly; and
             35          (D) sales and use taxes.
             36          (b) (i) "Item of taxable tangible personal property" does not include an improvement to
             37      real property or a part that will become an improvement.
             38          (ii) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             39      commission may make rules defining the term "item of taxable tangible personal property."
             40          (c) (i) "Taxable tangible personal property" means tangible personal property that is
             41      subject to taxation under this chapter.
             42          (ii) "Taxable tangible personal property" does not include:
             43          (A) tangible personal property required by law to be registered with the state before it
             44      is used:
             45          (I) on a public highway;
             46          (II) on a public waterway;
             47          (III) on public land; or
             48          (IV) in the air;
             49          (B) a mobile home as defined in Section 41-1a-102 ; or
             50          (C) a manufactured home as defined in Section 41-1a-102 .
             51          (2) (a) The first $25,000 of taxable tangible personal property of a taxpayer is exempt
             52      from taxation [if the taxable tangible personal property has a total aggregate fair market value
             53      per county of $3,500 or less].
             54          (b) [An] In addition to the exemption under Subsection (2)(a), an item of taxable
             55      tangible personal property is exempt from taxation if the item of taxable tangible personal
             56      property:
             57          (i) has an acquisition cost of $1,000 or less;
             58          (ii) has reached a percent good of 15% or less according to a personal property

             59      schedule:
             60          (A) published by the commission pursuant to Section 59-2-107 ; or
             61          (B) for an item of personal property that is designated as expensed personal property in
             62      accordance with Section 59-2-108 , described in Section 59-2-108 ; and
             63          (iii) is in a personal property schedule with a residual value of 15% or less.
             64          (3) (a) For calendar years beginning on or after January 1, [2008] 2014, the
             65      commission shall increase the dollar amount described in Subsection (2)(a):
             66          (i) by a percentage equal to the percentage difference between the consumer price
             67      index for the preceding calendar year and the consumer price index for calendar year [2006]
             68      2012; and
             69          (ii) up to the nearest $100 increment.
             70          (b) For purposes of this Subsection(3), the commission shall calculate the consumer
             71      price index as provided in Sections 1(f)(4) and 1(f)(5), Internal Revenue Code.
             72          (c) If the percentage difference under Subsection(3)(a)(i) is zero or a negative
             73      percentage, the consumer price index increase for the year is zero.
             74          (4) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             75      commission may make rules to administer this section and provide for uniform
             76      implementation.
             77          Section 2. Effective date.
             78          This bill takes effect on January 1, 2013.

Legislative Review Note
    as of 11-17-11 1:56 PM

Office of Legislative Research and General Counsel

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