Motor Vehicle Tax Crime: How It Hurts Texas
Motor vehicle tax provides the third-largest source of state tax income. In fiscal 2012, Texas motor vehicle tax collections totaled $3.5 billion. This revenue is then allocated to:
- public education,
- general revenue for state operations,
- property tax relief, and
- local tax assessor-collectors.
Case News Release
November 14, 2013: Ray Martinez, 35, of Midland, pled guilty in two cases to fraud relating to motor vehicles and was sentenced to 6 years deferred adjudication in each case. Martinez was accused in one indictment of knowingly providing a false and incorrect sales price, sales tax amount, and date of sale on an application for certificate of title to a motor vehicle, and in a second of forging the name of another person on the application. Both offenses are third-degree felonies. The cases, filed as cause number CR 40722 and -21, were prosecuted in the 238th Judicial District Court of Midland County.
Motor Vehicle Tax Investigations
Motor vehicle taxes are set by the Legislature and collected by the Comptroller of Public Accounts. Motor vehicle purchasers pay the motor vehicle sales tax to each county tax assessor-collector, generally through vehicle dealers. Tax Code §152.003 allows the Comptroller to supervise the >collection of the motor vehicle sales tax and >establish rules for determining the taxable value of motor vehicles.
Crimes and penalties relating to violations of the motor vehicle tax are described in Tax Code Chapter 152, Subchapter F. The chapter defines two felonies:
- Failure to Remit Taxes Collected (§152.104) pertains to dealers or persons acting in that capacity who fail to remit taxes collected to the county tax-assessor collector; such persons can be held criminally liable, with the penalty range determined by the amount of tax involved. A dealer faces felony criminal liability if $1,500 or more is not remitted, and can face first-degree felony punishment ranging from five to ninety-nine years or life in prison if the amount in question is $200,000 or more; and
- Signing a False Statement or Certificate (§152.101) makes it a third-degree felony to sign required statements knowing that they are false in any material fact.
Other Consequences in Addition to Criminal Punishment
Persons convicted may have their Motor Vehicle Retail Seller's Permit revoked or suspended (see Tax Code §152.068). The Comptroller's office may not issue a new permit after the revocation of a prior permit unless satisfied that the former permit holder will comply with the provisions of this chapter and Comptroller rules.
Venue of Prosecutions
Motor vehicle tax offenses can be prosecuted in the county in which they occur or in Travis County (see Tax Code §152.105).