SENATE BILL No. 233
DIGEST OF INTRODUCED BILL
Citations Affected: IC 6-2.5-5-38.2.
Synopsis: Sales tax treatment of car purchase discounts. Provides that
a rebate or employee discount on the sale of a motor vehicle is not part
of the gross retail income received by the seller when determining the
sales and use tax amount.
Effective: July 1, 2009.
January 7, 2009, read first time and referred to Committee on Tax and Fiscal Policy.
First Regular Session 116th General Assembly (2009)
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SENATE BILL No. 233
A BILL FOR AN ACT to amend the Indiana Code concerning
Be it enacted by the General Assembly of the State of Indiana:
SOURCE: IC 6-2.5-5-38.2; (09)IN0233.1.1. -->
SECTION 1. IC 6-2.5-5-38.2 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2009]: Sec. 38.2. (a)
The value of
an owned vehicle is exempt from the
gross retail tax in a
vehicle lease transaction if the owned vehicle is exchanged for a like
(b) The value of a third party's payment or credit, including an
employee discount, on the sale or lease of a motor vehicle is exempt
from the gross retail tax if the customer's purchase agreement
(1) the payment or credit is directly related to a price
reduction or discount on the sale or lease;
(2) the seller has an obligation to pass the price reduction or
discount through to the purchaser;
(3) the amount of the price reduction or discount is fixed and
determinable by the seller at the time of the sale or lease to
the purchaser; and
(4) the price reduction or discount is identified as a third
party price reduction or discount.