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297A.64 Rental motor vehicle tax imposed; rate.

Subdivision 1. Tax imposed. A tax is imposed on the lease or rental in this state for not more than 28 days of a passenger automobile as defined in section 168.011, subdivision 7, a van as defined in section 168.011, subdivision 28, or a pickup truck as defined in section 168.011, subdivision 29. The rate of tax is 6.2 percent of the sales price. The tax applies whether or not the vehicle is licensed in the state.

Subd. 2. Fee imposed. A fee equal to three percent of the sales price is imposed on leases or rentals of vehicles subject to the tax under subdivision 1. The lessor on the invoice to the customer may designate the fee as "a fee imposed by the State of Minnesota for the registration of rental cars."

Subd. 3. Administration. The retailer shall report and pay the tax imposed in subdivision 1 to the commissioner of revenue with the taxes imposed in this chapter. The tax imposed in subdivision 1 and the fee imposed in subdivision 2 are subject to the same interest, penalty, and other provisions provided for sales and use taxes under chapter 289A and this chapter. The commissioner has the same powers to assess and collect the tax and fee that are given the commissioner in chapters 270 and 289A and this chapter to assess and collect sales and use tax.

Subd. 4. Exemptions. (a) The tax and the fee imposed by this section do not apply to a lease or rental of (1) a vehicle to be used by the lessee to provide a licensed taxi service; (2) a hearse or limousine used in connection with a burial or funeral service; or (3) a van designed or adapted primarily for transporting property rather than passengers.

(b) The lessor may elect not to charge the fee imposed in subdivision 2 if in the previous calendar year the lessor had no more than 20 vehicles available for lease that would have been subject to tax under this section, or no more than $50,000 in gross receipts that would have been subject to tax under this section.

Subd. 5. Payment of excess fees. On the first sales tax return due following the end of a calendar year during which a lessor has imposed a fee under subdivision 2, the lessor shall report to the commissioner of revenue, in the form required by the commissioner, the amount of the fee collected during the previous year and the amount of motor vehicle registration taxes paid during the previous year by the lessor under chapter 168 on vehicles subject to the fee under this section. If the amount of the fees collected exceeds the amount of motor vehicle registration taxes paid, the lessor shall remit the excess to the commissioner of revenue at the time the report is submitted.

HIST: 2000 c 418 art 1 s 7

* NOTE: Subdivision 1 is repealed by Laws 2001, First *Special Session chapter 5, article 12, section 95, effective for *sales and purchases made after December 31, 2005.

* NOTE: Subdivision 3 was amended by Laws 2001, First *Special Session chapter 5, article 12, section 31, effective for *leases entered into after December 31, 2005. Laws 2001, First *Special Session chapter 5, article 12, section 31, the effective *date. The subdivision, as amended, will read as follows:

* "Subd. 3. Administration. The fee imposed in *subdivision 2 is subject to the same interest, penalty, and *other provisions provided for sales and use taxes under chapter *289A and this chapter. The commissioner has the same powers to *assess and collect the fee that are given the commissioner in *chapters 270 and 289A and this chapter to assess and collect *sales and use tax."

* NOTE: Subdivision 4 was amended by Laws 2001, First *Special Session chapter 5, article 12, section 32, effective for *leases entered into after December 31, 2005. Laws 2001, First *Special Session chapter 5, article 12, section 32, the effective *date. The subdivision, as amended, will read as follows:

* "Subd. 4. Exemptions. (a) The fee imposed by this *section does not apply to a lease or rental of (1) a vehicle to *be used by the lessee to provide a licensed taxi service; (2) a *hearse or limousine used in connection with a burial or funeral *service; or (3) a van designed or adapted primarily for *transporting property rather than passengers.

* (b) The lessor may elect not to charge the fee imposed in *subdivision 2 if in the previous calendar year the lessor had no *more than 20 vehicles available for lease that would have been *subject to tax under this section, or no more than $50,000 in *gross receipts that would have been subject to tax under this *section."