Proposition 6 – Motor Vehicle Exemption Amendment

TEXAS – Proposition 6 – HJR 54

Brief background information: (provided by the Texas Legislative Council)

In 2005 the 79th Legislature enacted House Bill No. 809 which said that a person is not required to report a motor vehicle used as both a personal vehicle and for business for tax appraisal purposes. However, taxation continued in many political subdivisions. In 2006 the Attorney General deemed that a legislative exemption from taxation was not valid without constitutional authorization. This lead to the proposed constitutional amendment known as Proposition 6.

With passage of Proposition 6, an individual who uses their vehicle for both business and personal activities could be exempted from ad valorem taxation on one motor vehicle. If passed, this amendment would apply to the tax year that begins January 1, 2007.

Pro and Con – information provided by Jacci Howard Bear of About.com

Why Vote for Prop 6 Passage would constitutionally establish what the Legislature wished to enact with House Bill 809 in 2005.

Exempting motor vehicles is consistent with current Texas law exempting other items of personal property such as stocks, bonds, and bank accounts.

Realtors, farmers, and other small business owners who use their personal vehicles in the course of doing business would benefit.

Why Vote Against Prop 6Other types of personal property used to produce income are taxable. A motor vehicle used to produce income should not be exempt simply because sometimes it is used for personal purposes.

Why restrict the exemption to only one vehicle? Some individuals use two or more vehicles for both business and personal purposes and that personal property should be treated in the same way — exempt all or none.

— Edited for the web by Miguel Martinez