Assigned to FIN                                                                                                                 FOR COMMITTEE

 

 

 

ARIZONA STATE SENATE

Phoenix, Arizona

 

FACT SHEET FOR S.B. 1233

 

vehicle license tax reduction

 

Purpose

 

            Phases out the current vehicle license tax portion to the Arizona highway users revenue fund (HURF) over a three-year period and assesses an additional phased-in motor vehicle fuel tax.

 

Background

 

Vehicle license tax (VLT) is assessed on new and used vehicles registered in Arizona, and is distributed to local governments and HURF.  HURF monies are further divided among the state highway fund, counties, cities and towns.  Until December 1, 2000, VLT monies were also collected for the state highway fund. 

 

S.B. 1233 reduces VLT for both new and used vehicles by approximately 45 percent by January 2004.  Specifically, the bill phases out VLT assessments for HURF, which are currently $1.26 and $1.30 per $100 of assessed valuation for new and used vehicles respectively. 

 

VLT allocations to local governments are unchanged.  The bill also increases motor vehicle fuel taxes deposited into HURF, over the same three-year period.

 

The fiscal impact of S.B. 1233 is currently undetermined.

 

Provisions

 

Additional Motor Vehicle Fuel Tax

 

1.      Establishes an additional phased-in motor vehicle fuel tax to be paid by consumers on motor vehicle fuel possessed, used or consumed in the state as follows:

 

  1. beginning on January 1, 2002, $0.03 per gallon;
  2. beginning on January 1, 2002, $0.06 per gallon;
  3. beginning on January 1, 2004, $0.09 per gallon.

 

2.      Requires motor vehicle fuel suppliers to collect and remit the tax.

 

3.      Imposes the tax when motor vehicle fuel, as measured by invoiced gallons, is either imported into Arizona for delivery here or removed from an Arizona bulk transfer terminal system or qualified terminal.

 

VLT

 

4.      Phases out the HURF VLT assessment charged on the initial registration of a new vehicle using the following schedule:

 

  1. through December 31, 2001, $1.26;
  2. beginning on January 1, 2002, $0.84;
  3. beginning on January 1, 2003, $0.42;
  4. beginning on January 1, 2004, zero.

 

5.      Phases out the HURF VLT assessment charged on the registration of used vehicles using the following schedule:

 

  1. through December 31, 2001, $1.30;
  2. beginning on January 1, 2002, $0.87;
  3. beginning on January 1, 2003, $0.44;
  4. beginning on January 1, 2004, zero.

 

6.      Removes obsolete language relating to the state highway fund portions of VLT on new and used vehicle registrations.  As of December 1, 2000, the state highway fund portions of VLT were eliminated and replaced with state general fund appropriations.

 

7.      Makes technical and conforming changes.

 

8.      Provides for a general effective date.

 

 

Prepared by Senate Staff

January 25, 2001