Bill > HB0107

This bill establishes an income tax credit for sales and use tax paid on certain motor vehicles, aiming to provide relief to individuals who purchase replacement vehicles. Specifically, it creates a nonrefundable tax credit for individuals, estates, and trusts who purchase a "replacement vehicle" (defined as a vehicle titled in the state that matches the previous owner's title, either after selling another Utah-titled vehicle within 30 days or after an insurance payout for a totaled vehicle). The credit amount will be a percentage of the sales tax paid on the replacement vehicle, with the percentage determined annually based on penalties deposited into a new "Motor Vehicle Sales Tax Restricted Account" compared to the total sales and use taxes paid on motor vehicles. This new account will be funded by penalties related to late vehicle registration and other specified penalties. The bill also makes several technical amendments to existing laws regarding vehicle registration, fees, and penalties, including the creation of a late registration penalty that will also be deposited into the Motor Vehicle Sales Tax Restricted Account. The provisions related to the tax credit will take effect for taxable years beginning on or after January 1, 2027, while other changes become effective on May 6, 2026.

Budget and Finance

https://le.utah.gov/~2026/bills/static/HB0107.html