neighborhood electric vehicles; VLT; exemption

Plain English Breakdown

The effective date is listed in the source only as 'general effective date,' so no specific start date can be confirmed from this text.

HB2367: Exempting Golf Carts and Certain Electric Vehicles from Vehicle License Tax

This bill changes the law so that alternative fuel golf carts and neighborhood electric vehicles meeting federal safety standards are not considered motor vehicles for tax purposes.

What This Bill Does

• Removes alternative fuel golf carts from the definition of a motor vehicle used to calculate taxes.
• Excludes neighborhood electric vehicles that meet specific federal rules (49 C.F.R. § 571.500) from being taxed as motor vehicles.
• Allows low-speed vehicles designed for speeds of 20 miles per hour or less to qualify without a standard 17-digit identification number.

Who It Names or Affects

• Owners of golf carts powered by alternative fuels such as electricity, solar energy, natural gas, hydrogen, or liquefied petroleum gas.
• Drivers of neighborhood electric vehicles that meet federal low-speed vehicle standards.
• State agencies responsible for collecting the annual Vehicle License Tax (VLT).

Terms To Know

Vehicle License Tax (VLT)

An annual fee collected by the state based on a percentage of a motor vehicle's value.

Neighborhood Electric Vehicle

A four-wheeled electric vehicle designed for low speeds, typically up to 25 miles per hour, that meets federal safety equipment rules including lights and seatbelts.

Alternative Fuel

Energy sources such as electricity, solar energy, liquefied petroleum gas, natural gas, hydrogen, or blends of these used to power vehicles instead of gasoline.

Limits and Unknowns

• The bill estimates a loss of $72,300 in annual tax revenue starting in fiscal year 2027.
• Vehicles must meet specific federal safety standards listed in Code of Federal Regulations section 571.500 to qualify for the exemption.

Official Summary Text

HB2367 - 572R - Senate Fact Sheet

Assigned to
ATT�������������������������������������������������������������������������������������������������������������������� FOR
COMMITTEE

ARIZONA STATE SENATE

Fifty-Seventh
Legislature, Second Regular Session

FACT SHEET FOR
H.B. 2367

neighborhood
electric vehicles; VLT; exemption

Purpose

Modifies the definition of
motor vehicle
, for the purposes of the
alternative fuel vehicle license tax (VLT), to exclude golf carts and
neighborhood electric vehicles.

Background

At the time of application for and before registration of the motor
vehicle, the registering officer must collect an annual VLT of $4 for each $100
in value. Statute prescribes procedures to determine the VLT for a motor
vehicle that is powered by alternative fuel based on the vehicle's retail price
and age (
A.R.S.
� 28-5805
).

Federal law specifies requirements for a vehicle to qualify as a
low-speed vehicle, including setting a maximum speed of 25 miles per hour and requiring
the vehicle to be equipped with: 1) head lights, tail lights and brake lights;
2) turn signals; 3) reflex reflectors; 4) a parking brake; 5) a windshield; 6)
a vehicle identification number; and 7) a type 1 or type 2 seatbelt (
49
C.F.R. � 571.500
).

A
motor vehicle
is a vehicle that meets the safety standards of
the National Highway Traffic Safety Administration and includes: 1)
neighborhood electric vehicles that meet federal regulations, except that if a
vehicle is designed to be operated at speeds of 20 miles per hour or less, the
vehicle is not required to have a 17-digit vehicle identification number; and

2) neighborhood electric shuttles (
A.R.S.
� 28-5805
).

Alternative fuel
is electricity, solar energy and liquefied
petroleum gas, natural gas, hydrogen or blend of hydrogen with liquefied
petroleum or natural gas (
A.R.S.
� 1-215
).

The Joint Legislative Budget Committee fiscal note on H.B. 2367 estimates
a decrease to VLT revenue collections of $72,300 on an ongoing basis beginning
in FY 2027 (
JLBC
).

Provisions

1.

Excludes,
from the definition of
motor vehicle
, alternative fuel golf carts and
neighborhood electric vehicles that federally qualify as a low-speed vehicle.

2.

Makes
technical changes.

3.

Becomes
effective on the general effective date.

House Action

TI������������������� 2/4/26������� DP������ 6-0-1-0

3
rd

Read��������� 2/26/26����������������� 40-13-7

Prepared by Senate Research

March 13, 2026

LMM/ci

Current Bill Text

HB2367 - 572R - H Ver

House Engrossed

neighborhood electric
vehicles; VLT; exemption

State of Arizona

House of Representatives

Fifty-seventh Legislature

Second Regular Session

2026

HOUSE BILL 2367

AN
ACT

Amending section 28-5805, Arizona Revised
Statutes; relating to neighborhood electric vehicles.

(TEXT OF BILL BEGINS ON NEXT PAGE)

Be it
enacted by the Legislature of the State of Arizona:

Section 1. Section 28-5805, Arizona Revised
Statutes, is amended to read:

START_STATUTE
28-5805.

Motor vehicle powered by alternative fuel; classification;
vehicle license tax; definitions

A. A separate classification of motor vehicles is
established for purposes of taxation pursuant to article IX, section 11,
Constitution of Arizona, that consists of motor vehicles that are powered by
alternative fuel and for which the department issues an alternative fuel
vehicle special plate or sticker pursuant to section 28-2416.

B. Notwithstanding section 28-5801, the
registering officer shall collect at the time of application for and before
registration of the motor vehicle that is classified under this section an
annual license tax of $4 for each $100 in value.� The motor vehicle value is
determined as follows:

1. For a motor vehicle that is registered in this
state before January 1, 2022, the value of the motor vehicle is one percent of
the manufacturer's base retail price of the motor vehicle.� After the first
twelve months of the life of the motor vehicle as determined by its initial
registration, the value of the motor vehicle is fifteen percent less for each
twelve-month period than the value for the preceding twelve-month
period.�

2. For a motor vehicle that is initially registered
in this state during a period beginning January 1, 2022 and ending December 31,
2022, during the first twelve months of the life of the motor vehicle as
determined by its initial registration, the value of the motor vehicle is
twenty percent of the manufacturer's base retail price of the motor
vehicle. During each succeeding twelve-month period, the value
of the motor vehicle is fifteen percent less than the value for the preceding
twelve-month period.

C. The registering officer shall collect the vehicle
license tax on a motor vehicle that is powered by alternative fuel and that is
initially registered from and after December 31, 2022 in accordance with
section 28-5801.� The minimum amount of the vehicle license tax collected
pursuant to this subsection must be in accordance with section 28-5801 and
shall be distributed pursuant to section 28-5808, subsection B.

D. Except as provided in subsection C of this
section, the minimum amount of the license tax computed under this section is
$5 per year for each motor vehicle subject to the tax.

E. Except as specifically provided in this section,
the vehicle license tax on a motor vehicle classified under this section is
governed by this article.

F. For the purposes of this section:

1. "Alternative fuel"
:

(
a
)
Has
the same meaning prescribed in section 1-215.

2. "Motor vehicle"
:

(
a
)
Means
a vehicle that meets the safety standards of the national highway traffic
safety administration
.

and

(
b
)
Includes
:
a NEIGHBORHOOD electric shuttle.

(a)
(
c
) Does not include:

(
i
) a
neighborhood
electric
vehicles
vehicle
that
meet
meets
the standards prescribed in 49
Code of Federal Regulations section 571.500
.
, except that, if a vehicle is designed to be operated at speeds
of twenty miles per hour or less, the vehicle is not required to have a
seventeen digit vehicle identification number
.

(b) Neighborhood electric shuttles.

(
ii
) a golf
cart.
END_STATUTE