Expanding property tax exemption eligibility to include commercial and industrial machinery and equipment that was acquired or transported into this state on or before June 30, 2006.

Session of 2026
SENATE BILL No. 320
By Committee on Assessment and Taxation
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AN ACT concerning property taxation; relating to exemptions; expanding
exemption eligibility to include commercial and industrial machinery
and equipment that was acquired or transported into this state on or
before June 30, 2006; amending K.S.A. 79-223 and repealing the
existing section.
Be it enacted by the Legislature of the State of Kansas:
Section 1. K.S.A. 79-223 is hereby amended to read as follows: 79-
223. (a) It is the purpose of this section to promote, stimulate, foster and
encourage new investments in commercial and industrial machinery and
equipment in the state of Kansas, to contribute to the economic recovery of
the state, to enhance business opportunities in the state, to encourage the
location of new businesses and industries in the state as well as the
retention and expansion of existing businesses and industries and to
promote the economic stability of the state by maintaining and providing
employment opportunities, thereby contributing to the general welfare of
the citizens of the state, by exempting from property taxation all newly
purchased or leased commercial and industrial machinery and equipment,
including machinery and equipment transferred into this state for the
purpose of expanding an existing business or for the creation of a new
business.
(b) The following described property, to the extent specified by this
section, shall be and is hereby exempt from all property or ad valorem
taxes levied under the laws of the state of Kansas:
First. Commercial and industrial machinery and equipment acquired
by qualified purchase or lease made or entered into after June 30, 2006, as
the result of a bona fide transaction not consummated for the purpose of
avoiding taxation.
Second. Commercial and industrial machinery and equipment
transported into this state after June 30, 2006, for the purpose of expanding
an existing business or creation of a new business.
Third. For all taxable years commencing after December 31, 2025,
commercial and industrial machinery and equipment acquired by qualified
purchase or lease made or entered into on or before June 30, 2006, as the
result of a bona fide transaction not consummated for the purpose of
avoiding taxation.
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SB 320 2
Fourth. For all taxable years commencing after December 31, 2025,
commercial and industrial machinery and equipment transported into this
state on or before June 30, 2006, for the purpose of expanding an existing
business or creation of a new business.
(c) Any purchase, lease or transportation of commercial and industrial
machinery and equipment consummated for the purpose of avoiding
taxation shall subject the property to the penalty provisions of K.S.A. 79-
1422 and 79-1427a, and amendments thereto. The county appraiser shall
not reclassify any property that is properly classified for property tax
purposes within subclass (5) of class 2 of section 1 of article 11 of the
constitution of the state of Kansas.
(d) As used in this section:
(1) "Acquired" shall does not include the transfer of property
pursuant to an exchange for stock securities, or the transfer of assets from
one going concern to another due to a merger, reorganization or other
consolidation;
(2) "commercial and industrial machinery and equipment" means
property classified for property tax purposes within subclass (5) of class 2
of section 1 of article 11 of the constitution of the state of Kansas, but shall
does not include any electric generation facility or addition to an electric
generation facility that is used predominately predominantly to produce
and generate electricity utilizing renewable energy resources or
technologies as defined in K.S.A. 79-201, and amendments thereto;
(3) "qualified lease" means a lease of commercial and industrial
machinery and equipment for not less than 30 days for fair and valuable
consideration where if such machinery and equipment is physically
transferred to the lessee to be used in the lessee's business or trade; and
(4) "qualified purchase" means a purchase of commercial and
industrial machinery and equipment for fair and valuable consideration
where if such machinery and equipment is physically transferred to the
purchaser to be used in the purchaser's business or trade.
(e) The secretary of revenue is hereby authorized to adopt rules and
regulations to administer the provisions of this section.
Sec. 2. K.S.A. 79-223 is hereby repealed.
Sec. 3. This act shall take effect and be in force from and after its
publication in the statute book.
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