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7 LONG TITLE
8 General Description:
9 This joint resolution of the Legislature proposes to amend the Utah Constitution to
10 modify provisions relating to the taxation of personal property.
11 Highlighted Provisions:
12 This resolution proposes to amend the Utah Constitution to:
13 . authorize the Legislature to provide for tangible personal property to be assessed
14 based on its value as reported for tax purposes to the United States government;
15 . authorize the Legislature to provide by statute a property tax exemption for tangible
16 personal property that has been fully depreciated or expensed; and
17 . authorize the Legislature to provide by statute for a nominal fee in lieu of property
18 tax on certain tangible personal property that is exempted from taxation.
19 Special Clauses:
20 This resolution directs the lieutenant governor to submit this proposal to voters.
21 This resolution provides a contingent effective date of January 1, 2013 for this proposal.
22 Utah Constitution Sections Affected:
24 ARTICLE XIII, SECTION 2
25 ARTICLE XIII, SECTION 3
27 Be it resolved by the Legislature of the state of Utah, two-thirds of all members elected to each
28 of the two houses voting in favor thereof:
29 Section 1. It is proposed to amend Utah Constitution Article XIII, Section 2, to read:
30 Article XIII, Section 2. [Property tax.]
31 (1) So that each person and corporation pays a tax in proportion to the fair market
32 value of his, her, or its tangible property, all tangible property in the State that is not exempt
33 under the laws of the United States or under this Constitution shall be:
34 (a) assessed at a uniform and equal rate in proportion to its fair market value, to be
35 ascertained as provided by law; and
36 (b) taxed at a uniform and equal rate.
37 (2) Each corporation and person in the State or doing business in the State is subject to
38 taxation on the tangible property owned or used by the corporation or person within the
39 boundaries of the State or local authority levying the tax.
40 (3) The Legislature may provide by statute that land used for agricultural purposes be
41 assessed based on its value for agricultural use.
42 (4) The Legislature may by statute determine the manner and extent of taxing livestock.
43 (5) The Legislature may by statute determine the manner and extent of taxing or
44 exempting intangible property, except that any property tax on intangible property may not
45 exceed .005 of its fair market value. If any intangible property is taxed under the property tax,
46 the income from that property may not also be taxed.
47 (6) Tangible personal property required by law to be registered with the State before it
48 is used on a public highway or waterway, on public land, or in the air may be exempted from
49 property tax by statute. If the Legislature exempts tangible personal property from property tax
50 under this Subsection (6), it shall provide for the payment of uniform statewide fees or uniform
51 statewide rates of assessment or taxation on that property in lieu of the property tax. The fair
52 market value of any property exempted under this Subsection (6) shall be considered part of the
53 State tax base for determining the debt limitation under Article XIV.
54 (7) The Legislature may by statute provide for the assessment of tangible personal
55 property according to its value as reported for tax purposes to the United States government in
56 conformity with the laws of the United States as from time to time amended.
57 Section 2. It is proposed to amend Utah Constitution Article XIII, Section 3, to read:
58 Article XIII, Section 3. [Property tax exemptions.]
59 (1) The following are exempt from property tax:
60 (a) property owned by the State;
61 (b) property owned by a public library;
62 (c) property owned by a school district;
63 (d) property owned by a political subdivision of the State, other than a school district,
64 and located within the political subdivision;
65 (e) property owned by a political subdivision of the State, other than a school district,
66 and located outside the political subdivision unless the Legislature by statute authorizes the
67 property tax on that property;
68 (f) property owned by a nonprofit entity used exclusively for religious, charitable, or
69 educational purposes;
70 (g) places of burial not held or used for private or corporate benefit;
71 (h) farm equipment and farm machinery as defined by statute;
72 (i) water rights, reservoirs, pumping plants, ditches, canals, pipes, flumes, power
73 plants, and transmission lines to the extent owned and used by an individual or corporation to
74 irrigate land that is:
75 (i) within the State; and
76 (ii) owned by the individual or corporation, or by an individual member of the
77 corporation; and
78 (j) (i) if owned by a nonprofit entity and used within the State to irrigate land, provide
79 domestic water, as defined by statute, or provide water to a public water supplier:
80 (A) water rights; and
81 (B) reservoirs, pumping plants, ditches, canals, pipes, flumes, and, as defined by
82 statute, other water infrastructure;
83 (ii) land occupied by a reservoir, ditch, canal, or pipe that is exempt under Subsection
84 (1)(j)(i)(B) if the land is owned by the nonprofit entity that owns the reservoir, ditch, canal, or
85 pipe; and
86 (iii) land immediately adjacent to a reservoir, ditch, canal, or pipe that is exempt under
87 Subsection (1)(j)(i)(B) if the land is:
88 (A) owned by the nonprofit entity that owns the adjacent reservoir, ditch, canal, or
89 pipe; and
90 (B) reasonably necessary for the maintenance or for otherwise supporting the operation
91 of the reservoir, ditch, canal, or pipe.
92 (2) (a) The Legislature may by statute exempt the following from property tax:
93 (i) tangible personal property constituting inventory present in the State on January 1
94 and held for sale in the ordinary course of business;
95 (ii) tangible personal property present in the State on January 1 and held for sale or
96 processing and shipped to a final destination outside the State within 12 months;
97 (iii) subject to Subsection (2)(b), property to the extent used to generate and deliver
98 electrical power for pumping water to irrigate lands in the State;
99 (iv) up to 45% of the fair market value of residential property, as defined by statute;
100 (v) household furnishings, furniture, and equipment used exclusively by the owner of
101 that property in maintaining the owner's home; [
102 (vi) tangible personal property that, if subject to property tax, would generate an
103 inconsequential amount of revenue[
104 (vii) tangible personal property that lawfully has been fully depreciated or accounted
105 for as an expense.
106 (b) The exemption under Subsection (2)(a)(iii) shall accrue to the benefit of the users
107 of pumped water as provided by statute.
108 (c) If the Legislature exempts tangible personal property under Subsection (2)(a)(vi),
109 the Legislature may by statute provide for the imposition of a nominal fee to be paid in lieu of
110 property tax on the exempted property.
111 (3) The following may be exempted from property tax as provided by statute:
112 (a) property owned by a disabled person who, during military training or a military
113 conflict, was disabled in the line of duty in the military service of the United States or the State;
115 (b) property owned by the unmarried surviving spouse or the minor orphan of a person
117 (i) is described in Subsection (3)(a); or
118 (ii) during military training or a military conflict, was killed in action or died in the line
119 of duty in the military service of the United States or the State.
120 (4) The Legislature may by statute provide for the remission or abatement of the taxes
121 of the poor.
122 Section 3. Submittal to voters.
123 The lieutenant governor is directed to submit this proposed amendment to the voters of
124 the state at the next regular general election in the manner provided by law.
125 Section 4. Effective date.
126 If the amendment proposed by this joint resolution is approved by a majority of those
127 voting on it at the next regular general election, the amendment shall take effect on January 1,
Legislative Review Note
as of 2-10-12 8:53 AM