§ 105-187.5. Alternate tax for those who rent or lease motor vehicles.
§ 105‑187.5. Alternatetax for those who rent or lease motor vehicles.
(a) Election. Aretailer may elect not to pay the tax imposed by this Article at the rate setin G.S. 105‑187.3 when applying for a certificate of title for a motorvehicle purchased by the retailer for lease or rental. A retailer who makesthis election shall pay a tax on the gross receipts of the lease or rental ofthe vehicle. Like the tax imposed by G.S. 105‑187.3, this alternate taxis a tax on the privilege of using the highways of this State. The tax isimposed on a retailer, but is to be added to the lease or rental price of amotor vehicle and thereby be paid by the person who leases or rents thevehicle.
(b) Rate. The taxrate on the gross receipts from the short‑term lease or rental of a motorvehicle is eight percent (8%) and the tax rate on the gross receipts from thelong‑term lease or rental of a motor vehicle is three percent (3%). Grossreceipts does not include the amount of any allowance given for a motor vehicletaken in trade as a partial payment on the lease or rental price. The maximumtax in G.S. 105‑187.3(a) on certain motor vehicles applies to acontinuous lease or rental of such a motor vehicle to the same person.
(c) Method. Aretailer who elects to pay tax on the gross receipts of the lease or rental ofa motor vehicle shall make this election when applying for a certificate oftitle for the vehicle. To make the election, the retailer shall complete a formprovided by the Division giving information needed to collect the alternate taxbased on gross receipts. Once made, an election is irrevocable.
(d) Administration. The Division shall notify the Secretary of Revenue of a retailer who makes theelection under this section. A retailer who makes this election shall reportand remit to the Secretary the tax on the gross receipts of the lease or rentalof the motor vehicle. The Secretary shall administer the tax imposed by thissection on gross receipts in the same manner as the tax levied under G.S. 105‑164.4(a)(2).The administrative provisions and powers of the Secretary that apply to the taxlevied under G.S. 105‑164.4(a)(2) apply to the tax imposed by thissection. In addition, the Division may request the Secretary to audit aretailer who elects to pay tax on gross receipts under this section. When theSecretary conducts an audit at the request of the Division, the Division shallreimburse the Secretary for the cost of the audit, as determined by theSecretary. In conducting an audit of a retailer under this section, theSecretary may audit any sales of motor vehicles made by the retailer. (1989, c. 692, s. 4.1; 1991,c. 79, s. 5; c. 193, s. 3; 1995, c. 410, s. 1; 2000‑173, s. 10(b); 2001‑424,s. 34.24(b); 2001‑497, s. 2(c).)