To exempt from sales tax the value of a trade-in when buying a new motor vehicle, titled watercraft or recreational vehicle, but phase this tax break in over 24 years. The phase-in would be suspended if the federal health care law's ("Obamacare") Medicaid expansion (authorized by House Bill 4714
) is rescinded, but legal experts are divided over whether this would be allowed.
The buyer would only pay sales tax on the difference between the value of the trade-in and the purchase price of the new car. Initially, the tax break would only apply to $2,000 of the price difference, and this would increase $500 per year. When fully implemented the tax break's value would reach $226 million (in 2013 dollars).