Did rebuilding the same owner's truck with a glider kit or major reconditioned motor trigger Texas motor vehicle tax?

Plain-English summary

Rebuilding the same owner's truck with a glider kit or major reconditioned motor did not trigger historical motor vehicle tax.

The inquiry said dealers collected limited and local sales and use taxes on the kit or parts and documented that payment on transfer affidavits. The rebuild could require registration because identification or motor numbers changed.

With no ownership change, the Ad Valorem-Intangible Tax Division concluded that another motor vehicle tax would be double taxation. The Limited Sales Tax Division agreed.

What this means for you

The no-tax conclusion depended on both continued ownership and prior sales-tax treatment of the rebuild parts. It did not decide a later transfer of the completed truck.

Common questions

Q: Did registration alone create motor vehicle tax?
A: No, on these facts.

Q: Was an ownership change involved?
A: No.

Q: Had other tax been paid?
A: The letter assumed limited and local sales taxes were paid on the parts.

Citations and references

• No statute or rule was cited in the letter.

Source

• STAR search: https://star.comptroller.texas.gov/search?doc_type_code=L&tax_type_code=MVT
• Opinion: https://star.comptroller.texas.gov/view/6810L2012A09

Original ruling text

COMPTROLLER OF PUBLIC ACCOUNTS
STATE OF TEXAS
AUSTIN

October 16, 1968

Mr. Gerald A. Rickett
Regional Manager
Comptroller of Public Accounts
2600 Stemmons Freeway, Suite 196A
Dallas, Texas 75207

Dear Mr. Rickett:

Your letter of October 10th addressed to Mr. Robert S. Calvert has
come to my desk for my answer. You mentioned the difficulty truck
dealers are having relative to the installation of major re-condi-
tioned motors in trucks.

You are advised that I am of the opinion that in cases where there
has been no change in ownership, no Motor Vehicle Sales and Use Tax
will be due, inasmuch as, the Limited Sales Tax has, no doubt, been
paid on all parts used in re-conditioning the motor and further levy
would constitute double taxation.

I have today discussed this matter at length with Mr. A. R. Anderson,
Director of the Limited Sales Tax Division, and he is in agreement
with this position.

Yours very truly,
J. B. Craig, Director
AD VALOREM-INTANGIBLE TAX DIVISION

October 10, 1968

Hon. Robert S. Calvert
Comptroller of Public Accounts
Austin, Texas 78711

Attention: Director, Ad Valorem and Intangible Division

RE: Tax on Rebuilding Kits

Dear Sir:

It has come to our attention that some of the area truck dealers are
having
problems relative to the sale of "kits" or glider units" which are sold
for
the use in major reconditioning of trucks.

A manufacturer's certificate is furnished to the purchaser because the
vehicle
identification number and/or the motor number change is involved and
regis-
tration must be accomplished.

The dealers have been collecting the Limited Sales, Excise and Use Tax
and the
Local Sales and Use Tax and have been certifying this fact on the Seller,
Donor, or Trader's affidavits. This procedure appears to us to be
correct,
however the problems arise when some assessor-collectors have maintained
a
Motor Vehicle Sales and Use Tax is due.

Customers of the dealers are therefore reluctant to pay them the Limited
Sales
and Use Tax, when a demand is also made for the Motor Vehicle Tax in some
counties.

If our contention as mentioned above is correct, please verify this so
that
we may counsel with the dealers and assessor-collectors if necessary.

Yours very truly,
Gerald A. Rickett
Regional Manager