103 KAR 44:090. Policies and circulars
relating to motor vehicle usage tax.
RELATES TO: KRS 138.450 to 138.470
STATUTORY AUTHORITY: KRS 131.130(1)
NECESSITY, FUNCTION AND CONFORMITY: KRS
131.130(1) authorizes the Department of Revenue to promulgate administrative
regulations necessary for the administration and enforcement of all tax laws in
Kentucky. The department has issued policies and circulars, a number of which
predate KRS Chapter 13A, that conflict with current tax laws or are redundant
in light of other relevant legal authority, resulting in needless uncertainty
as to the validity of the information expressed in those policies and
circulars. This administrative regulation formally rescinds the previously-issued
policies and circulars relating to taxes administered by the department’s Office
of Sales and Excise Taxes.
Section 1. The following policies and
circulars merely restate or summarize the requirements or provisions of the motor
vehicle usage tax statutes of KRS Chapter 138 and applicable administrative
regulations cited below, and are hereby formally rescinded and shall be null,
void, and unenforceable:
(1) Policies:
(a) Revenue Policy 71P015 (revised
12/1/86), relating to which price must be used for motor vehicle usage tax
purposes when a price increase has occurred on the manufacturer’s suggested
retail price between the order date and the delivery date of a vehicle (KRS
138.450, 138.460, and 103 KAR 44:060);
(b) Revenue Policy 71P016 (revised
12/1/86), relating to the applicable usage tax due on equipment and accessories
mounted on a truck chassis (KRS 138.450(9));
(c) Revenue Policy 71P025 (revised
12/1/86), relating to the tax exempt transfer of a vehicle which has been
transferred from a proprietorship to a corporation, back to a proprietorship
within six (6) months from the date the business is incorporated (KRS
138.470(8));
(d) Revenue Policy 71P030 (revised 12/1/94),
relating to credit for tax previously paid when registering a motor vehicle
that was previously registered in another state (KRS 138.460(6));
(e) Revenue Policy 71P070 (revised 6/1/83),
relating to the tax treatment of transactions involving repossessed vehicles
that are held for resale (KRS 138.470(13));
(f) Revenue Policy 71P120 (revised 6/1/83),
relating to the collection of usage tax when registering a vehicle in the names
of both spouses when only one spouse qualifies for the military exemption (KRS
138.470(4) and (6)); and
(g) Revenue Policy 71P130 (revised 6/1/83),
relating to credit for sales tax paid on the purchase of a motorcycle collected
at time of purchase against the usage tax paid at time of registration (KRS
138.460(6)); and
(2) Circulars:
(a) Revenue Circular 71C169 (revised
4/15/83), relating to usage tax on forced registrations (KRS 138.470(5) and 186.145);
and
(b) Revenue Circular 71C183 (revised
4/15/83), relating to sales tax credit on initial motorcycle registration (KRS
138.460(6)).
Section 2. The following policies and
circulars are no longer accurate due to subsequent regulatory or statutory
changes and are hereby formally rescinded and shall be null, void, and unenforceable:
(1) Policies:
(a) Revenue Policy 71P010 (revised
12/1/86), relating to the computation of usage tax using the value of the
vehicle on the date of registration or the date appearing on the transfer
document (KRS 138.460 and 138.470(6));
(b) Revenue Policy 71P020 (revised
3/31/94), relating to credit for tax paid in another state by one (1) spouse,
ex-spouse, parent, child, stepparent, stepchild, grandparent or grandchild
allowed against the Kentucky usage tax when the other spouse, ex-spouse,
parent, child, stepparent, stepchild, grandparent or grandchild registers an
out-of-state motor vehicle in his or her name (KRS 138.460 and 138.470(6));
(c) Revenue Policy 71P071 (revised
11/30/92), relating to credit for tax previously paid when registering a motor
vehicle that was previously registered in another state (KRS 138.460(6));
(d) Revenue Policy 71P080 (revised
6/1/83), relating to the reduction of the retail price of a used vehicle when
more than one (1) used vehicle is traded-in on the vehicle being registered
(KRS 138.450(10));
(e) Revenue Policy 71P085 (revised
12/1/86), relating to trade-credit allowed on used vehicles purchased in
another state by a licensed Kentucky dealer that is registered in the dealer’s
name and subsequently traded to a Kentucky resident (KRS 138.450 and 138.470);
and
(f) Revenue Policy 71P150 (revised
6/1/83), relating to transfers of used school buses (KRS 138.450 and 103 KAR
44:060); and
(2) Circulars:
(a) Revenue Circular 71C172 (revised
12/1/90), relating to trade-in allowance (KRS 138.450);
(b) Revenue Circular 71C176 (revised
4/15/83), relating to "For Sale and Transfer" registrations (KRS
138.460);
(c) Revenue Circular 71C179 (revised
12/1/86), relating to vehicles that have been repossessed by a financial
institution and redeemed by the debtor (KRS 138.470(13)); and
(d) Revenue Circular 71C189 (revised
4/15/83), relating to tax credit given to a Kentucky resident for a similar tax
paid to another state (KRS 138.460).
Section 3. The following policies are not
covered by statute and are being rescinded and shall be null, void, and
unenforceable:
(1) Revenue Policy 71P040 (revised
6/1/83), relating to two (2) names on the same registration when transferred
into only one (1) of those names; and
(2) Revenue Policy 71P060 (revised
6/1/83), relating to when usage tax is applicable and when it is refundable on
the transfer of stolen vehicles. (33 Ky.R. 2824; 3162; eff. 5-4-2007.)