Relating to exemptions from the taxes imposed on the sale, use, or rental of a motor vehicle for a vehicle purchased, used, or rented by a nonprofit food bank or a provider of housing and related services.

Contracts

• Vehicle Leases: Renegotiate open lease terms for execution on or after June 20. Ensure capitalized cost calculations exclude the 6.25% tax. Existing leases are generally not affected unless refinanced.
• Rental Agreements: Update Master Service Agreements (MSAs) with vendors like Enterprise or Hertz. File tax-exemption certificates with their corporate tax departments immediately to prevent automatic tax charges at the counter.

Hiring/Training

• Procurement Staff: Must be trained to flag all vehicle acquisitions as "Tax Exempt" and provide the dealer with proof of eligibility (Section 162.001 or 151.310(a) status).
• Drivers/Fleet Managers: Must be trained to maintain specific mileage logs distinguishing "Qualifying Charitable Use" from "General Administrative Use" to satisfy the "primary use" statutory requirement.
• Dealership F&I: Finance managers must update Dealership Management Systems (DMS) to accept tax-exempt codes for these specific nonprofit categories.

Reporting & Record-Keeping

• Exemption Certificates: Purchasers must execute a Motor Vehicle Exemption Certificate at the time of sale.
• Internal Affidavits: Create an internal "Affidavit of Primary Use" for every vehicle file, explicitly stating the vehicle's intended role in food distribution or housing services.
• Audit Defense Logs: Maintain a rolling 48-month mileage log. If audited, you must prove >50% of mileage was for the specific exempt purpose, not general errands.

Fees & Costs

• Cost Reduction: Direct savings of 6.25% on the purchase price or rental rate of motor vehicles.
• Administrative Cost: Minimal increase in administrative overhead for maintaining mileage logs and exemption certificates.