The bill proposes a temporary exemption from sales and use taxes for certain residential heating, ventilation, and air conditioning (HVAC) systems and their installation services. Specifically, it introduces a new section, 151.360, to the Tax Code, which stipulates that sales and installations of qualifying HVAC systems will be exempt from taxes if the sale occurs between March 1, 2026, and September 1, 2027. To qualify, the system must be used in the purchaser's primary single-family residence, have a minimum Seasonal Energy Efficiency Rating (SEER) of 14, be Energy Star qualified, and be installed by a licensed contractor. Additionally, if installation costs are separate from the system's sale price, the installation service will also be exempt if completed within 90 days of the sale.

The bill outlines specific exclusions from this exemption, including systems installed in rental or commercial properties or in structures built less than one year prior to the sale. It mandates that the comptroller create an exemption certificate by November 1, 2025, which purchasers must provide to sellers at the time of sale to qualify for the exemption. If the purchaser uses the system in a manner that does not qualify for the exemption, they will be liable for the sales tax on the original purchase price. The exemption is set to expire on December 31, 2027. The bill will take effect immediately upon receiving a two-thirds vote from both houses or on September 1, 2025, if such a vote is not achieved.

Statutes affected:
Introduced: ()