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- 83rd Session (2025)
Senate Bill No. 196–Senator Cannizzaro
CHAPTER..........
AN ACT relating to taxation; providing for the imposition,
administration, collection and enforcement of a recovery fee
to offset property taxes levied on certain heavy equipment;
providing penalties; and pro viding other matters properly
relating thereto.
Legislative Counsel’s Digest:
Under existing law, all property of every kind and nature in this State is subject
to property taxes unless the property is exempt from such taxation. (NRS 361.045)
In general, this bill authorizes a heavy equipment rental company that is primarily
engaged in the business of renting heavy equipment, without an operator, from a
location in this State to charge a recovery fee to offset the property taxes levied on
such heavy equipm ent. Under existing regulations, such a recovery fee would be
excluded from the sales or use tax charged for the rental of the heavy equipment.
(NAC 372.940)
Section 13 of this bill authorizes such a heavy equipment rental company to
charge a recovery fee in an amount not to exceed 2 percent of the rental charge for
the rental of the heavy equipment. Under section 13, a heavy equipment rental
company that charges a recovery fee is required to: (1) separately state on the
invoice provided to the renter the amount of the recovery fee charged to the renter;
(2) hold the recovery fee in a separate account; and (3) use the pr oceeds of the
recovery fee to offset the property taxes levied on heavy equipment rental property.
Section 14 of this bill exempts from the charging of a recovery fee the rental of any
heavy equipment rental property to certain governmental entities.
Section 15 of this bill requires a heavy equipment rental company to submit to
the Department of Taxation an annual report stating the amount of the recovery fees
collected by the heavy equipment rental company during the immediately
preceding fiscal year and the amount of the property taxes levied on the heavy
equipment rental property of the heavy equipment rental company for the
immediately preceding fiscal year.
Sections 4-10 of this bill define certain terms relating to the imposition of the
recovery fee on the rental of heavy equipment rental property. Section 3 of this bill
establishes the applicability of those definitions.
Sections 11 and 12 of this bill establish provisions governing the retention and
examination of records relevant to the recovery fee. Section 16 of this bill provides
that a person who submits a false or fraudulent report concerning the recovery fee
or falsifies entries in or keeps more than one set of books, records or accounts , with
intent to defraud in violation of the requiremen t to use the recovery fees only to
offset property taxes, is guilty of a gross misdemeanor.
EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted.
THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN
SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:
Section 1. (Deleted by amendment.)
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- 83rd Session (2025)
Sec. 2. Chapter 361 of NRS is hereby amended by adding
thereto the provisions set forth as sections 3 to 16, inclusive, of this
act.
Sec. 3. As used in sections 3 to 16, inclusive, of this act,
unless the context otherwise requires, the words and terms defined
in sections 4 to 10, inclusive, of this act have the meanings
ascribed to them in those sections.
Sec. 4. 1. “Affiliate” means a person who, directly or
indirectly, through one or more persons or intermediaries,
controls, is controlled by or is under common control with a
specified person.
2. As used in this section, “control” means:
(a) Direct or indirect ownership, control or possession of 50
percent or more of the equity ownership of a person; or
(b) Possession, direct or indirect, of the power to direct or
cause the direction of the management and policies of a person,
whether through the ownership of voting securities, by contract or
through other means.
Sec. 5. 1. “Heavy equipment rental company” means a
person who is classified under 532412 or 532310 of the North
American Industry Classification System, and is primarily
engaged in the business of renting heavy equipment rental
property, without an operator, to the public from a location in this
State.
2. The term does not include a person who is:
(a) Engaged in the business of renting heavy equipment rental
property primarily to related persons or affiliates who operate or
drive, or both operate and drive, such equipment, regardless of the
NAICS code that applies to the business; or
(b) Primarily engaged in the business of renting heavy
equipment rental property with an operator.
Sec. 6. “Heavy equipment rental proper ty” means property,
machinery and equipment held in the inventory of a heavy
equipment rental company for sale or rental in the regular course
of business. The term includes, without limitation, property,
machinery and equipment that is customarily used or designed for
construction and industrial purposes, including, without
limitation, earthmoving equipment, lift equipment, material
handling equipment, pumps, generators, compressors, portable
power equipment, heating, ventilation and air conditioning
equipment, portable offices, containers, tank trailers and self -
propelled equipment.
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Sec. 7. “North American Industry Classification System” or
“NAICS” means the 2022 North American Industry Classification
System, as published by the Bureau of the Census of the United
States Department of Commerce.
Sec. 8. “Rent,” “rental” or “renting” means entering into an
agreement with a heavy equipment rental company for the use of
heavy equipment rental property in exchange for consideration for
a period:
1. Not to exceed 365 days; or
2. That is open -ended under the terms of the rental contract
with no specified end date.
Sec. 9. 1. “Rental charge” means the total amount of
consideration, including, without limitation, cash, credit, property
and services, charged by a heavy equipment rental company for
the rental of heavy equipment rental property, valued in money,
whether received in money or otherwise, and without any
deduction for:
(a) The cost of the heavy equipment rental property to the
heavy equipment rental company;
(b) The cost of materials used, labor or service cost, interest
paid, losses, the cost of transportation to the heavy equipment
rental company, taxes imposed on the heavy equipment rental
company or any other expense of the heavy equipment rental
company; and
(c) Any charges by the heavy equipment rental company for
any services necessary to complete the rental, including, without
limitation, any deli very charges which are not stated separately
and any installation charges which are not stated separately.
2. The term does not include:
(a) Any fees or charges for the delivery or transportation of
heavy equipment rental property which are stated separately;
(b) Any installation or other service charges which are stated
separately;
(c) Any discounts, including, without limitation, those in the
form of cash, term or coupons that are not reimbursed by a third
party, which are allowed by the heavy equipm ent rental company
and taken by the renter on a rental;
(d) Any interest, financing or carrying charges from credit
extended on the rental of heavy equipment rental property, if
stated separately;
(e) Any taxes legally imposed directly on the renter whic h are
stated separately; and
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- 83rd Session (2025)
(f) Any other separately stated charges or fees , including,
without limitation , any separately stated fee for recovery of
property taxes imposed on heavy equipment rental property
pursuant to this chapter.
Sec. 10. “Renter” means a person who rents heavy
equipment rental property from a heavy equipment rental
company in this State.
Sec. 11. 1. Each person responsible for maintaining the
records of a heavy equipment rental company shall:
(a) Keep such records as may be necessary to determine the
compliance of the heavy equipment rental company with the
provisions of section 15 of this act;
(b) Preserve such records for 5 years or until any litigation or
prosecution related to compliance with section 15 of this act is
finally determined, whichever is longer; and
(c) Make such records available for inspection by the
Department upon demand at reasonable times during regular
business hours.
2. The Department may adopt regulations specifying the types
of records which must be kept to determine the compliance of a
heavy equipment rental company with the provisions of section 15
of this act.
Sec. 12. To verify the accuracy of any report filed pursuant
to section 15 of this act or, if no such report is filed, to determine
the compliance of a heavy equipment rental company with section
15 of this act, the Department, or any person authorized in writing
by the Department, may examine the books, papers and records of
any person who is required to comply with section 15 of this act.
Sec. 13. 1. Except as otherwise provided in section 14 of
this act, a heavy equipment rental company may impose a recovery
fee in an amount not to exceed 2 percent of the rental charge for
the rental of heavy equipment rental property to a renter.
2. The amount of any recovery fee imposed pursuant to
subsection 1 must be separately stated on an invoice provided to a
renter of heavy equipment rental property.
3. A heavy equipment rental company that imposes a recovery
fee pursuant to subsection 1 shall:
(a) Hold the amount of all recovery fees collected in a separate
account; and
(b) Use the money in the separate account only to offset any
taxes imposed pursuant to this chapter on heavy equipment rental
property.
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Sec. 14. A heavy equipment rental company shall not charge
a recovery fee pursuant to section 13 of this act for the rental of
any heavy equipment rental property to:
1. The United States, its unincorporated agencies and
instrumentalities;
2. Any incorporated agency or instrumentality of the United
States wholly owned by the United States or by a corporation
wholly owned by the United States;
3. The State of Nevada, its unincorporated agencies and
instrumentalities;
4. Any county, city, district or other political subdivision of
this State; and
5. Any other person or entity that this State is prohibited from
taxing under the United States Constitution, laws or treaties of the
United States or the Nevada Constitution.
Sec. 15. Not later than August 15 of each calendar ye ar, a
heavy equipment rental company that imposes a recovery fee
pursuant to section 13 of this act shall file with the Department,
on a form prescribed by the Department, a report which separately
states the amount of:
1. The recovery fees collected by the heavy equipment rental
company during the immediately preceding fiscal year; and
2. The taxes imposed pursuant to this chapter on the heavy
equipment rental property of the heavy equipment rental company
for the immediately preceding fiscal year.
Sec. 16. 1. A person shall not:
(a) Make, cause to be made or permit to be made any false or
fraudulent report or false statement in any report with intent to
defraud in violation of the requirements of subsection 3 of section
13 of this act;
(b) Make, cause to be made or permit to be made any false
entry in books, records or accounts with intent to defraud in
violation of the requirements of subsection 3 of section 13 of this
act; or
(c) Keep, cause to be kept or permit to be kept more than one
set of books, records or accounts with intent to defraud in
violation of the requirements of subsection 3 of section 13 of this
act.
2. Any person who violates the provisions of subsection 1 is
guilty of a gross misdemeanor.
Secs. 17 and 18. (Deleted by amendment.)
Sec. 19. This act becomes effective on July 1, 2025.
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