AB403 - Proposes to exempt from sales and use taxes the amount of any allowance against the selling price given by a retailer for the value of a used portable electronic taken in trade on the purchase of another portable electronic. (BDR 32-565)

EXEMPT (Reprinted with amendments adopted on April 21, 2025) FIRST REPRINT A.B. 403 - *AB403_R1* ASSEMBLY BILL NO. 403–ASSEMBLYMEMBER TORRES-FOSSETT MARCH 11, 2025 ____________ Referred to Committee on Revenue SUMMARY—Proposes to exempt from sales and use taxes the amount of any allowance against the selling price given by a retailer for the value of a used portable electronic taken in trade on the purchase of another portable electronic. (BDR 32-565) FISCAL NOTE: Effect on Local Government: May have Fiscal Impact. Effect on the State: Yes. ~ EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted. AN ACT relating to taxes on retail sales; providing for the submission to the voters of the question of whether the Sales and Use Tax Act of 1955 should be amended to exempt from the taxes the amount of any allowance against the selling price given by a retailer for the value of a used portable electronic taken in trade on the purchase of another portable electronic under certain circumstances; providing for the same exemption from certain analogous taxes if the voters approve this amendment to the Sales and Use Tax Act of 1955; and providing other matters properly relating thereto. Legislative Counsel’s Digest: The nonadministrative provisions of the Sales and Use Tax Act of 1955 (part of 1 chapter 372 of NRS) were approved by the voters by a referendum and therefore 2 may not be amended, annulled, repealed, set aside, suspended or in any way made 3 inoperative except by the direct vote of the people. (Nev. Const. Art. 19, § 1) 4 Sections 2-9 of this bill require the submission of a question to the voters at the 5 2026 General Election of whether the Sales and Use Tax Act of 1955 should be 6 amended to provide an exemption for the amount of any allowance against the 7 selling price given by a retailer for the value of a used portable electronic taken in 8 trade on the purchase of another portable electronic, if the amount of the allowance 9 is known and provided in full to the customer at the time of purchase and stated on 10 the sales receipt and the trade-in and purchase occur as part of a single, 11 contemporaneous transaction. Sections 10-13 of this bill amend the Local School 12 Support Tax Law (chapter 374 of NRS) to provide an identical exemption. These 13 – 2 – - *AB403_R1* tax exemptions become effective on January 1, 2027, and expire by limitation on 14 December 31, 2050, only if the voters approve the amendment to the Sales and Use 15 Tax Act of 1955 at the General Election in 2026. 16 Any amendment to the Local School Support Tax Law also applies to other 17 sales and use taxes imposed under existing law. (NRS 354.705, 374A.020, 18 376A.060, 377.040, 377A.030, 377B.110, 543.600 and various special and local 19 acts) Therefore, if the voters approve the exemption proposed by this bill, from 20 January 1, 2027, through December 31, 2050, the exemption will apply to all sales 21 and use taxes currently contemplated under existing law. 22 THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS: Section 1. The Legislature hereby finds that each exemption 1 provided by this act from any excise tax on the sale, storage, use or 2 consumption of tangible personal property sold at retail: 3 1. Will achieve a bona fide social or economic purpose and that 4 the benefits of the exemption are expected to exceed any adverse 5 effect of the exemption on the provision of services to the public by 6 the State or a local government that would otherwise receive 7 revenue from the tax from which the exemption would be granted; 8 and 9 2. Will not impair adversely the ability of the State or a local 10 government to pay, when due, all interest and principal on any 11 outstanding bonds or any other obligations for which revenue from 12 the tax from which the exemption would be granted was pledged. 13 Sec. 2. At the General Election on November 3, 2026, a 14 proposal must be submitted to the registered voters of this State to 15 amend the Sales and Use Tax Act, which was enacted by the 47th 16 Session of the Legislature of the State of Nevada and approved by 17 the Governor in 1955, and subsequently approved by the people of 18 this State at the General Election held on November 6, 1956. 19 Sec. 3. At the time and in the manner provided by law, the 20 Secretary of State shall transmit the proposed act to the several 21 county clerks, and the county clerks shall cause it to be published 22 and posted as provided by law. 23 Sec. 4. The proclamation and notice to the voters given by the 24 county clerks pursuant to law must be in substantially the following 25 form: 26 Notice is hereby given that at the General Election on 27 November 3, 2026, a question will appear on the ballot for the 28 adoption or rejection by the registered voters of the State of the 29 following proposed act: 30 AN ACT to amend an Act entitled “An Act to provide 31 revenue for the State of Nevada; providing for sales 32 and use taxes; providing for the manner of collection; 33 – 3 – - *AB403_R1* defining certain terms; providing penalties for 1 violation, and other matters properly relating thereto.” 2 approved March 29, 1955, as amended. 3 4 THE PEOPLE OF THE STATE OF NEVADA 5 DO ENACT AS FOLLOWS: 6 7 Section 1. The above entitled Act, being chapter 397, 8 Statutes of Nevada 1955, at page 762, is hereby amended by 9 adding thereto a new section to be designated as section 18.3, 10 immediately following section 18.2, to read as follows: 11 Sec. 18.3 “Portable electronic” means an electronic 12 device that is portable in nature and its accessories. 13 Sec. 2. Section 11 of the above-entitled Act, being 14 chapter 397, Statutes of Nevada 1955, at page 764, and 15 amended by chapter 400, Statutes of Nevada 2003, at page 16 2397, and amended by chapter 484, Statutes of Nevada 2005, 17 at page 2493, is hereby amended to read as follows: 18 Sec. 11. 1. “Sales price” means the total amount 19 for which tangible property is sold, valued in money, 20 whether paid in money or otherwise, without any 21 deduction on account of any of the following: 22 (a) The cost of the property sold. 23 (b) The cost of materials used, labor or service cost, 24 interest charged, losses, or any other expenses. 25 (c) The cost of transportation of the property before its 26 purchase. 27 2. The total amount for which property is sold 28 includes all of the following: 29 (a) Any services that are a part of the sale. 30 (b) Any amount for which credit is given to the 31 purchaser by the seller. 32 3. “Sales price” does not include any of the 33 following: 34 (a) Cash discounts allowed and taken on sales. 35 (b) The amount charged for property returned by 36 customers when the entire amount charged therefor is 37 refunded either in cash or credit, except that this exclusion 38 does not apply in any instance when the customer, in order 39 to obtain the refund, is required to purchase other property 40 at a price greater than the amount charged for the property 41 that is returned. 42 (c) The amount charged for labor or services rendered 43 in installing or applying the property sold. 44 – 4 – - *AB403_R1* (d) The amount of any tax, not including any 1 manufacturers’ or importers’ excise tax, imposed by the 2 United States upon or with respect to retail sales, whether 3 imposed upon the retailer or consumer. 4 (e) The amount of any allowance against the selling 5 price given by a retailer for the value of a used vehicle 6 which is taken in trade on the purchase of another vehicle. 7 (f) The amount of any allowance against the selling 8 price given by a retailer for the value of a used portable 9 electronic which is taken in trade on the purchase of 10 another portable electronic if: 11 (1) The amount of the allowance is known and 12 provided in full to the customer at the time of the 13 purchase; 14 (2) The amount of the allowance is stated 15 separately on the sales receipt; and 16 (3) The trade-in of the used portable electronic 17 and the purchase of another portable electronic occur as 18 part of a single, contemporaneous transaction. 19 Sec. 3. Section 12 of the above entitled Act, being 20 chapter 397, Statutes of Nevada 1955, at page 764, and 21 amended by chapter 400, Statutes of Nevada 2003, at page 22 2398, and amended by chapter 484, Statutes of Nevada 2005, 23 at page 2494, is hereby amended to read as follows: 24 Sec. 12. 1. “Gross receipts” means the total 25 amount of the sale or lease or rental price, as the case may 26 be, of the retail sales of retailers, valued in money, 27 whether received in money or otherwise, without any 28 deduction on account of any of the following: 29 (a) The cost of the property sold. However, in 30 accordance with such rules and regulations as the Tax 31 Commission may prescribe, a deduction may be taken if 32 the retailer has purchased property for some other purpose 33 than resale, has reimbursed his vendor for tax which the 34 vendor is required to pay to the State or has paid the use 35 tax with respect to the property, and has resold the 36 property before making any use of the property other than 37 retention, demonstration or display while holding it for 38 sale in the regular course of business. If such a deduction 39 is taken by the retailer, no refund or credit will be allowed 40 to his vendor with respect to the sale of the property. 41 (b) The cost of the materials used, labor or service 42 cost, interest paid, losses or any other expense. 43 (c) The cost of transportation of the property before its 44 sale to the purchaser. 45 – 5 – - *AB403_R1* 2. The total amount of the sale or lease or rental price 1 includes all of the following: 2 (a) Any services that are a part of the sale. 3 (b) All receipts, cash, credits and property of any kind. 4 (c) Any amount for which credit is allowed by the 5 seller to the purchaser. 6 3. “Gross receipts” does not include any of the 7 following: 8 (a) Cash discounts allowed and taken on sales. 9 (b) The sale price of property returned by customers 10 when the full sale price is refunded either in cash or credit, 11 but this exclusion does not apply in any instance when the 12 customer, in order to obtain the refund, is required to 13 purchase other property at a price greater than the amount 14 charged for the property that is returned. 15 (c) The price received for labor or services used in 16 installing or applying the property sold. 17 (d) The amount of any tax, not including any 18 manufacturers’ or importers’ excise tax, imposed by the 19 United States upon or with respect to retail sales, whether 20 imposed upon the retailer or the consumer. 21 (e) The amount of any allowance against the selling 22 price given by a retailer for the value of a used vehicle 23 which is taken in trade on the purchase of another vehicle. 24 (f) The amount of any allowance against the selling 25 price given by a retailer for the value of a used portable 26 electronic which is taken in trade on the purchase of 27 another portable electronic if: 28 (1) The amount of the allowance is known and 29 provided in full to the customer at the time of the 30 purchase; 31 (2) The amount of the allowance is stated 32 separately on the sales receipt; and 33 (3) The trade-in of the used portable electronic 34 and the purchase of another portable electronic occur as 35 part of a single, contemporaneous transaction. 36 4. For purposes of the sales tax, if the retailers 37 establish to the satisfaction of the Tax Commission that 38 the sales tax has been added to the total amount of the sale 39 price and has not been absorbed by them, the total amount 40 of the sale price shall be deemed to be the amount 41 received exclusive of the tax imposed. 42 Sec. 4. This act becomes effective on January 1, 2027, 43 and expires by limitation on December 31, 2050. 44 – 6 – - *AB403_R1* Sec. 5. The ballot page assemblies and the paper ballots to be 1 used in voting on the question must present the question in 2 substantially the following form: 3 Shall the Sales and Use Tax Act of 1955 be amended to 4 exempt from the taxes imposed by this Act on the gross 5 receipts from the sale and the storage, use or other 6 consumption of tangible personal property, the amount of any 7 allowance against the selling price given by a retailer for the 8 value of a used portable electronic taken in trade on the 9 purchase of another portable electronic? 10 Yes  No  11 Sec. 6. The explanation of the question which must appear on 12 each paper ballot and sample ballot and in every publication and 13 posting of notice of the question must be in substantially the 14 following form: 15 16 (Explanation of Question) 17 The proposed amendment to the Sales and Use Tax Act of 18 1955 would exempt from the taxes imposed by this Act on 19 the gross receipts from the sale and the storage, use or other 20 consumption of tangible personal property, the amount of any 21 allowance against the selling price given by a retailer for the 22 value of a used portable electronic taken in trade on the 23 purchase of another portable electronic if the amount of 24 the allowance is known and provided in full to the customer 25 at the time of purchase and stated on the sales receipt and the 26 trade-in and purchase occur as part of a single, 27 contemporaneous transaction. If this proposal is adopted, the 28 Legislature has provided that the Local School Support Tax 29 Law and certain analogous taxes on retail sales will be 30 amended to provide the same exemption. 31 Sec. 7. If a majority of the votes cast on the question is yes, 32 the amendment to the Sales and Use Tax Act of 1955 becomes 33 effective on January 1, 2027, and expires by limitation on 34 December 31, 2050. If less than a majority of votes cast on the 35 question is yes, the question fails and the amendment to the Sales 36 and Use Tax Act of 1955 does not become effective. 37 Sec. 8. All general election laws not inconsistent with this act 38 are applicable. 39 Sec. 9. Any informalities, omissions or defects in the content 40 or making of the publications, proclamations or notices provided for 41 [Text truncated for display. Full text available on LegiScan.]