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HF2751 (Legislative Session 94 (2025-2026))

Motor vehicle sales tax exemption amended.

Related bill: SF1210

AI Generated Summary

Purpose of the Bill

The purpose of this bill is to amend state tax laws in Minnesota related to the exemptions from sales tax on motor vehicles. It clarifies and adds specific situations where the purchase or use of motor vehicles would be exempt from sales taxes.

Main Provisions

  • Exemptions for Government and Out-of-State Purchases: It maintains tax exemptions for vehicles purchased by the U.S. government and its agencies, as well as by residents of other states or countries who move to Minnesota, provided certain conditions are met.
  • Leased and Interstate Vehicles: Vehicles leased for interstate commerce or part of specific lease-purchase agreements continue to be exempt.
  • Educational and Nonprofit Use Exemptions: Vehicles used in educational training programs and owned by nonprofit or public educational institutions for training remain exempt from sales tax.
  • Special Utility Vehicle Exemptions: Vehicles like readymixed concrete trucks, snowplows, and other maintenance vehicles used solely for road maintenance by towns are exempt.
  • Library and Ambulance: Bookmobiles and vehicles used by ambulance services for emergency purposes receive exemptions.
  • Charitable and Religious Organizations: Vehicles used primarily by charitable, religious, or educational organizations for their purposes are exempt from sales tax.
  • Transit and Job Zone Vehicles: Vehicles used by transit providers or in job opportunity building zones for specified purposes are exempt.
  • Medical and Veteran Use: Vehicles used as mobile medical units by qualified centers or purchased by veterans with total service-connected disabilities are exempt.

Significant Changes

The bill expands and clarifies existing tax exemptions, ensuring that state laws align with federal definitions and requirements for various exempt entities. It confirms the continuation and clarifies the scope of exemptions involving multiple sectors, including government, education, non-profit, and charitable organizations.

Relevant Terms

  • Sales tax exemptions
  • Motor vehicles
  • Government agency
  • Nonprofit and educational institutions
  • Interstate commerce
  • Charitable, religious, and educational purposes
  • Transit service
  • Job opportunity building zone
  • Mobile medical unit
  • Service-connected disability

Bill text versions

Actions

DateChamberWhereTypeNameCommittee Name
March 23, 2025HouseFloorActionIntroduction and first reading, referred toTransportation Finance and Policy
March 23, 2025HouseFloorActionIntroduction and first reading, referred toTransportation Finance and Policy

Citations

 
[
  {
    "analysis": {
      "added": [
        "Clarifications on valid exemptions for agency and instrumentalities purchases."
      ],
      "removed": [],
      "summary": "This bill amends exemptions to the sales tax on motor vehicles under section 297A.67 subdivision 11.",
      "modified": []
    },
    "citation": "297A.67",
    "subdivision": "subdivision 11"
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "A reference to the license requirements for ambulance services as per section 144E.10.",
      "modified": []
    },
    "citation": "144E.10",
    "subdivision": ""
  },
  {
    "analysis": {
      "added": [
        "Inclusion of library delivery vehicle exemptions."
      ],
      "removed": [],
      "summary": "This bill involves the definition of public library as per section 134.001 subdivision 2.",
      "modified": []
    },
    "citation": "134.001",
    "subdivision": "subdivision 2"
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "References are made to definitions of truck, bus, and passenger automobile within section 168.002.",
      "modified": []
    },
    "citation": "168.002",
    "subdivision": ""
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "Exemption applicable to a transit provider receiving financial assistance under section 174.24.",
      "modified": []
    },
    "citation": "174.24",
    "subdivision": ""
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "This statute provides financial assistance criteria applicable to the exemptions.",
      "modified": []
    },
    "citation": "473.384",
    "subdivision": ""
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "References operations of transit provider under section 174.29.",
      "modified": []
    },
    "citation": "174.29",
    "subdivision": ""
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "Bill concerns transit operations as per section 473.388.",
      "modified": []
    },
    "citation": "473.388",
    "subdivision": ""
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "Discusses operations of transit facilities mentioned in section 473.405.",
      "modified": []
    },
    "citation": "473.405",
    "subdivision": ""
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "This statute defines a qualified business in a job opportunity building zone as referenced.",
      "modified": []
    },
    "citation": "469.310",
    "subdivision": ""
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "Requirements for a motor vehicle lessor license under section 168.27 subdivision 4.",
      "modified": []
    },
    "citation": "168.27",
    "subdivision": "subdivision 4"
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "Defines total service-connected disability for veterans under section 171.01 subdivision 51.",
      "modified": []
    },
    "citation": "171.01",
    "subdivision": "subdivision 51"
  }
]

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