(a) Definitions. The following words and terms, when used in this section, shall have the following meanings, unless the context clearly indicates otherwise.
  (1) Application for Texas Title and/or Registration--Form 130-U, its electronic equivalent, or a successor form, promulgated jointly by the comptroller and the Texas Department of Motor Vehicles, used to apply for a motor vehicle title and registration and to pay any motor vehicle sales or use tax due. The Application for Texas Title and/or Registration is available at comptroller.texas.gov.
  (2) Cash discount--An actual reduction of the price required to be paid by the purchaser to the dealer. The term includes, but is not limited to, separately stated manufacturers' rebates, dealers' rebates, and cash rebates passed directly to the purchaser at the time of sale, and discounts allowed for payment within a specified time.
  (3) Date of sale--The day the purchaser takes possession of a motor vehicle unless otherwise specified by written agreement.
  (4) Dealer--A person who holds a general distinguishing number or operates under similar regulatory requirements of another state or jurisdiction. The term includes a franchised motor vehicle dealer, a nonfranchised motor vehicle dealer, an independent mobility motor vehicle dealer, and a wholesale motor vehicle dealer. The term does not include a salvage vehicle dealer licensed under Occupations Code, Chapter 2302 (Salvage Vehicle Dealers).
  (5) Distributor--A person, other than a manufacturer, who:
    (A) distributes or sells new motor vehicles to a franchised motor vehicle dealer; or
    (B) enters into franchise agreements with franchised motor vehicle dealers, on behalf of the manufacturer.
  (6) Extended warranty or service contract--A policy sold to the purchaser of a motor vehicle for an additional amount, the provisions of which become effective after the manufacturer's warranty expires.
  (7) Franchised motor vehicle dealer--A person who:
    (A) holds a franchised motor vehicle license issued under Occupations Code, Chapter 2301 (Sale or Lease of Motor Vehicles); and
    (B) is engaged in the business of buying, selling, or exchanging new motor vehicles at an established and permanent place of business under a franchise agreement with a manufacturer or distributor; or
    (C) is licensed under similar regulatory requirements of another state or jurisdiction.
  (8) General distinguishing number--A dealer license issued by the Texas Department of Motor Vehicles under Transportation Code, Chapter 503 (Dealer's and Manufacturer's Vehicle License Plates).
  (9) Independent mobility motor vehicle dealer--A dealer who is not a franchised motor vehicle dealer who:
    (A) holds a general distinguishing number issued by the Texas Department of Motor Vehicles;
    (B) holds a converter's license issued under Occupations Code, Chapter 2301;
    (C) is engaged in the business of buying, selling, or exchanging mobility motor vehicles defined by Occupations Code, §2301.002(20-a) (Definitions) and servicing or repairing the devices installed on mobility motor vehicles at an established and permanent place of business in Texas; and
    (D) is certified by the manufacturer of each mobility device that the dealer installs, if the manufacturer offers that certification.
  (10) Lease--An agreement other than a rental, by an owner of a motor vehicle to give for longer than 180 days exclusive use of a motor vehicle to another for consideration. For more information on motor vehicle leases, see §3.70 of this title (relating to Motor Vehicle Leases and Sales).
  (11) Manufacturer--A person who manufactures or assembles new motor vehicles and holds a manufacturer's license issued under Occupations Code, §2301.259 (Application for Manufacturer's License). The term does not include a person operating only as an ambulance manufacturer, chassis manufacturer, fire-fighting vehicle manufacturer, motor home manufacturer, or a converter as those terms are defined in Occupations Code, §2301.002 (Definitions).
  (12) Motor vehicle--A vehicle described by Tax Code, §152.001(3) (Definitions). In general, a motor vehicle includes a self-propelled vehicle designed to transport persons or property upon the public highway and a vehicle designed to be towed by a self-propelled vehicle while carrying property. The term includes, but is not limited to: automobiles; buses; vans; motor homes; motorcycles; trucks and truck tractors; truck cab and chassis; semitrailers; trailers and travel trailers, as defined by §3.72 of this title (relating to Trailers, Farm Machines, and Timber Machines); trailers sold unassembled in a kit; dollies; jeeps; stingers; auxiliary axles; converter gears; and park models, as defined by §3.481 of this title (relating to Imposition and Collection of Manufactured Housing Tax). The term does not include a vehicle to which the certificate of title has been surrendered in exchange for a salvage vehicle title or a nonrepairable vehicle title issued under Transportation Code, Chapter 501 (Certificate of Title Act).
  (13) New motor vehicle--A motor vehicle that, without regard to mileage, has not been the subject of a retail tax.
  (14) Nonfranchised dealer--A person who holds an independent motor vehicle dealer's general distinguishing number, an independent mobility motor vehicle dealer's general distinguishing number, or a wholesale motor vehicle dealer's general distinguishing number issued by the Texas Department of Motor Vehicles.
  (15) Related finance company--A person in which at least 80% of the ownership is identical to the ownership of a dealer, as defined by Transportation Code, §503.001 (Definitions).
  (16) Rental--An agreement:
    (A) by the owner of a motor vehicle to give exclusive use of that motor vehicle to another for consideration, for a period of time not to exceed 180 days under any one agreement;
    (B) by an original manufacturer of a motor vehicle to give exclusive use of the motor vehicle to another for consideration; or
    (C) by the owner of a motor vehicle to give exclusive use of the motor vehicle to another for re-rental purposes, regardless of the period of time covered by the agreement.
  (17) Retail sale--A sale of a motor vehicle other than:
    (A) a sale for resale; or
    (B) a sale for lease, meaning a sale to a franchised motor vehicle dealer of a new motor vehicle removed from the franchised motor vehicle dealer's inventory for the purpose of entering into a contract to lease the motor vehicle to another person if, within seven days of executing the lease contract, the franchised motor vehicle dealer transfers title of the motor vehicle and assigns the lease contract to the lessor of the motor vehicle. If the title is not transferred and the lease assigned within seven calendar days, the dealer's purchase and use will be presumed to be a retail purchase and taxable. The presumption may be overcome by showing evidence of intent.
  (18) Sale for resale--The sale of a motor vehicle to a purchaser who acquires the motor vehicle either for the exclusive purpose of sale in a manner provided by law, or for purposes allowed by the Texas Department of Motor Vehicles under Transportation Code, Chapter 503, when the purchaser is:
    (A) a distributor;
    (B) a manufacturer;
    (C) a franchised motor vehicle dealer who is authorized by law and by a franchise agreement to offer a motor vehicle for sale as a new motor vehicle; or
    (D) a nonfranchised motor vehicle dealer who is authorized by law to offer a motor vehicle for sale as a used motor vehicle.
    (E) The following are examples of uses allowed under Transportation Code, Chapter 503, that do not disqualify a purchase as a sale for resale:
      (i) when a dealer uses the motor vehicle on public highways with a metal dealer's plate issued under Transportation Code, §503.061 (Dealer's License Plates);
      (ii) when a manufacturer or distributor removes a motor vehicle from its inventory and tests the motor vehicle on public highways with a manufacturer's plate issued under Transportation Code, §503.064 (Manufacturer's License Plates); and
      (iii) when a manufacturer or distributor loans the motor vehicle to a consumer for a purpose described by Occupations Code, §2301.605 (Rebuttable Presumption--Reasonable Number of Attempts).
  (19) Seller-financed sale--A retail sale of a motor vehicle by a dealer in which the selling dealer collects all or part of the total consideration in periodic payments and retains a lien on the motor vehicle until all payments have been received. The term does not include a:
Cont'd...