| (a) Definitions. The following words and terms, when
used in this section, shall have the following meanings, unless the
context clearly indicates otherwise.
(1) Accessories--Nonessential tangible personal property
attached to or sold with a vessel for the convenience or comfort of
the operator or passengers. The term "accessories" includes, but is
not limited to, radios, mirrors, transom-mounted ladders, electric
trolling motors, water skis, tow ropes, and depth finders. The term
does not include a boat trailer.
(2) Agent of the Department--A dealer who is authorized
by the Department under Parks and Wildlife Code, §31.006 (Appointment
of Authorized Agent), to collect taxes and fees and issue certificates
of number for taxable boats and outboard motors sold by that dealer
in Texas.
(3) Application for Certificate of Title and/or Registration--Form
PWD 143 (boats) or PWD 144 (outboard motors), an electronic equivalent,
or a successor form used to apply for a certificate of title and/or
registration for a taxable boat or outboard motor and/or to pay any
sales or use tax due on the sale or use of a taxable boat or outboard
motor in Texas. The Applications for Certificate of Title and/or Registration
are available at https://tpwd.texas.gov/fishboat/boat/forms/.
(4) Dealer--A person who holds a license issued by
the Department to engage in the business of buying, selling, selling
on consignment, displaying for sale, or exchanging at least five taxable
boats or outboard motors in Texas during a calendar year at an established
or permanent place of business in Texas.
(5) Department--The Texas Parks and Wildlife Department.
(6) Distributor--A person who holds a license issued
by the Department to engage in the business of selling, offering for
sale, or processing for distribution new taxable boats or outboard
motors to dealers in Texas.
(7) Federally documented vessel--A vessel of five net
tons or more, operated on United States navigable waters that has
been issued a valid marine certificate of documentation on file with
the United States Coast Guard National Vessel Documentation Center.
(8) Manufacturer--A person who holds a license issued
by the Department to engage in the business of manufacturing new and
unused taxable boats and outboard motors for the purpose of sale or
trade.
(9) Participating county tax assessor-collector--A
county tax assessor-collector in Texas that has an agreement with
the Department to title and/or register taxable boats or outboard
motors in Texas.
(10) Registered repair facility--A person engaged in
the business of repairing, remodeling, maintaining, or restoring taxable
boats or outboard motors that holds a current Texas sales and use
tax permit issued under Tax Code, Chapter 151 (Limited Sales, Excise,
and Use Tax).
(11) Retail sale--An installment or credit sale of
a taxable boat or outboard motor, an exchange of a taxable boat or
outboard motor for property or money, or an exchange in which a taxable
boat or outboard motor is transferred but the seller retains title
as security for payment of the purchase price. The term does not include
a sale in which the dealer, distributor, or manufacturer acquires
the taxable boat or outboard motor for the exclusive purpose of resale.
Dealers, distributors, and manufacturers are the only persons who
may acquire a taxable boat or outboard motor for resale.
(12) Taxable boat--A vessel not more than 115 feet
in length, measured from the tip of the bow in a straight line to
the stern, other than a canoe, kayak, rowboat, raft, punt, or other
watercraft designed to be propelled only by paddle, oar, or pole.
The term includes federally documented vessels, sailboats, personal
watercraft, and boats designed to accommodate an outboard motor. The
term does not include seaplanes. Seaplanes, and canoes, kayaks, rowboats,
rafts, punts, or other watercraft designed to be propelled only by
paddle, oar, or pole, are not "taxable boats" under Tax Code, Chapter
160 (Taxes On Sales And Use Of Boats And Boat Motors), but are subject
to tax under Tax Code, Chapter 151. (Limited Sales, Excise and Use
Tax).
(13) Outboard motor--Any self-contained internal combustion
propulsion system of any horsepower, excluding fuel supply, used to
propel a vessel that is detachable as a unit from the vessel. The
term does not include electric boat motors.
(14) Temporary use permit--A non-renewable, non-transferable
permit issued by the Department, an agent of the Department, or a
participating county tax assessor-collector authorizing the temporary
tax-free use of a taxable boat or outboard motor within the territorial
boundaries of Texas for not more than 90 consecutive days from the
date of issue. Only two temporary use permits may be issued for the
same taxable boat or outboard motor within a calendar year. The second
temporary use permit cannot be issued until 30 days after the date
the first permit expires. The nonrefundable fee for the permit is
$150 per taxable boat or outboard motor.
(15) Territorial boundaries of Texas--All territory
within the exterior borders of Texas. The offshore border of Texas
extends nine nautical miles from the coastline of Texas.
(16) Total consideration--The amount paid or to be
paid for a taxable boat or outboard motor, including all accessories
attached thereto at the time of the sale. The amount includes payments
by the purchaser for the costs of material, labor or service, interest
paid, loss, or any other expense, transportation before the sale,
any manufacturer's or importer's excise tax imposed by the United
States government, and any dealer's vessel and outboard motor inventory
property tax imposed on the dealer and passed through to the purchaser.
The amount also includes anything of monetary value received by the
seller, such as cash or the equivalent; a book entry reflecting cash
received or paid; the forgiveness or assumption of debt; book entries
reflecting accounts receivable or accounts payable for an item; the
performance of a service; or real or tangible personal property. The
amount does not include any separately stated discount, finance or
interest charges, documentary charges, transportation charges after
the sale, or the value of another taxable boat or outboard motor taken
by the seller as all or part of the consideration for the sale of
the taxable boat or outboard motor.
(17) Use--Any storage or other exercise of rights of
ownership in Texas by any person excluding:
(A) the storage, display, or holding of a taxable boat
or outboard motor exclusively for sale by a dealer, distributor, or
manufacturer; or
(B) troubleshooting or testing of a taxable boat or
outboard motor being repaired, remodeled, maintained, or restored
by a registered repair facility under subsection (g)(1) of this section.
(18) Vessel--Any watercraft, other than a seaplane
on water, used or capable of being used for transportation on water.
The definition includes a ship, barge, taxable boat, yacht, or any
watercraft designed to be propelled by paddle, oar or pole.
(b) General principles of taxation.
(1) The purchase of a taxable boat or outboard motor
and all accessories attached thereto at the time of sale in Texas
is subject to Tax Code, Chapter 160, including the purchase of a taxable
boat or outboard motor for purposes of lease or rental.
(2) The lease or rental of a taxable boat or outboard
motor in Texas is subject to Tax Code, Chapter 151, and cannot be
purchased tax-free for resale.
(3) The purchase of accessories for a taxable boat
or outboard motor attached after the time of sale of the taxable boat
or outboard motor is subject to Tax Code, Chapter 151.
(4) The purchase of tangible personal property that
cannot be identified as a taxable boat or outboard motor at the time
of sale is subject to Tax Code, Chapter 151, even if the combination
of items of tangible personal property later becomes a taxable boat
or outboard motor. If items of tangible personal property are combined
to create a taxable boat or outboard motor, the initial titling or
registration of the taxable boat or outboard motor in the name of
the person who created the taxable boat or outboard motor is not subject
to Tax Code, Chapter 160. If the taxable boat or outboard motor is
titled or registered in any other person's name, the taxable boat
or outboard motor is considered transferred to that person and is
subject to Tax Code, Chapter 160.
(5) The purchase of safety equipment required by Parks
and Wildlife Code, §§31.064-31.071, including life preservers
and fire extinguishers, purchased with a taxable boat or outboard
motor are considered to be attached to the taxable boat or outboard
motor at the time of sale and subject to Tax Code, Chapter 160.
Cont'd... |
