Division of the Budget
Landon State Office Building Phone: (785) 296-2436
900 SW Jackson Street, Room 504 adam.c.proffitt@ks.gov
Topeka, KS 66612 Division of the Budget http://budget.kansas.gov
Adam Proffitt, Director Laura Kelly, Governor


April 5, 2021


The Honorable Adam Smith, Chairperson
House Committee on Taxation
Statehouse, Room 185A-N
Topeka, Kansas 66612
Dear Representative Smith:
SUBJECT: Fiscal Note for HB 2452 by House Committee on Taxation
In accordance with KSA 75-3715a, the following fiscal note concerning HB 2452 is
respectfully submitted to your committee.
Under current law, the sales tax for a motor vehicle, trailer, semi-trailer, or aircraft that do
not qualify as transportation equipment is determined at the location of the address of the retailer.
HB 2452 would require that the sales tax for these vehicle types to be determined at the location
where the vehicle is registered or intended to be registered.
The Department of Revenue estimates that HB 2452 would have no fiscal effect on state
revenues. The bill would change the distribution of local retail sales and compensating use tax
revenues between local governments; however, the Department does not have data to provide a
specific fiscal effect on each local government that would have increased or decreased local
revenues as a result of this bill.
The Department of Revenue indicates that it would require a total $93,907 from the State
General Fund in FY 2022 to implement the bill and to modify the automated tax system. The bill
would require the Department to hire 1.00 new FTE position to answer questions from taxpayers
and to review, process, and audit sales tax returns. The Department estimates that ongoing
expenses for salary and wages for the 1.00 FTE position would total $55,961 from the State
General Fund in FY 2023. The required programming for this bill by itself would be performed
by existing staff of the Department of Revenue. In addition, if the combined effect of
implementing this bill and other enacted legislation exceeds the Department’s programming
resources, or if the time for implementing the changes is too short, additional expenditures for
outside contract programmer services beyond the Department’s current budget may be required.
The Honorable Adam Smith, Chairperson
Page 2—HB 2452

The League of Kansas Municipalities and the Kansas Association of Counties indicate the
bill would have a different fiscal effect on each specific local government based on the amount of
vehicle sales activity occurring in each city or county. Areas that have significant motor vehicle
sales activity would likely receive lower local sales tax revenues, whereas areas that lack
significant motor vehicle sales activity would likely experience an increase in local sales tax
revenue. Any fiscal effect associated with HB 2452 is not reflected in The FY 2022 Governor’s
Budget Report.


Sincerely,

Adam Proffitt
Director of the Budget

cc: Jay Hall, Association of Counties
Ben Cleeves, Transportation
Wendi Stark, League of Municipalities
Lynn Robinson, Department of Revenue


Statutes affected:
As introduced: 12-191, 12-199