MOTOR VEHICLES.

SEC. 801. MOTOR VEHICLES. (a) Exemptions From Tax.—Subsection (a) of section 4063 (relating to specific articles exempt from the tax on automobiles) is amended to read as follows: “(a) Specified Articles.— “(1) Camper coaches; bodies for self-propelled mobile homes.—The tax imposed under section 4061 shall not apply in the case of articles designed (A) to be mounted or placed on automobile trucks, automobile truck chassis, or automobile chassis, and (B) to be used primarily as living quarters. “(2) Feed, seed, and fertilizer equipment.— The tax imposed under section 4061 shall not apply in the case of any body, part or accessory primarily designed— “(A) to process or prepare seed, feed, or fertilizer for use on farms; “(B) to haul feed, seed, or fertilizer to and on farms; “(C) to spread feed, seed, or fertilizer on farms; “(D) to load or unload feed, seed, or fertilizer on farms; or “(E) for any combination of the foregoing. “(3) House trailers.—The tax imposed under section 4061(a) shall not apply in the case of house trailers. 79 Stat. 158 “(4) Small 3-wheeled trucks.— The tax imposed under section 4061 (a) shall not apply in the case of— “(A) an automobile truck chassis which— “(i) has only 3 wheels, “(ii) is powered by a motor which does not exceed 18 brake horsepower (rated at 4,000 revolutions per minute), and “(iii) does not exceed 1,000 pounds gross weight; or “(B) a body designed primarily to be mounted on a chassis described in subparagraph (A).” (b) Manufacturers’ Price of Trucks in Which Used Parts Are Incorporated.— Section 4216 (relating to definition of price) is amended by adding at the end thereof the following new subsection: “(g) Certain Trucks Incorporating Used Components.—For purposes of the tax imposed by section 4061(a)(1) (relating to trucks, buses, etc.), in determining the price for which an article is sold, the value of any component of such article shall be excluded from the price, if— “(1) such component is furnished by the first user of such article, and “(2) such component has been used prior to such furnishing.” (c) Rebuilding of Parts Not Considered Manufacturing.— Paragraph (6) of section 4221(d) (relating to tax-free sales for use in further manufacture) is amended by adding at the end thereof the following new sentence: “For purposes of subparagraph (B), the rebuilding of a part or accessory which is exempt from tax under section 4063(c) shall not constitute the manufacture or production of such part or accessory.” (d) School Buses.— (1) Tax-free sales.—Subsection (e) of section 4221 (relating to certain tax-free sales) is amended by adding at the end thereof the following new paragraph: “(5) School buses.—Under regulations prescribed by the Secretary or his delegate, the tax imposed by section 4061(a) shall not apply to a bus sold to any person for use exclusively in transporting students and employees of schools operated by State or local governments or by nonprofit educational organizations. For purposes of this paragraph, incidental use of a bus in providing transportation for a State or local government or a nonprofit organization described in section 501(c) which is exempt from tax under section 501(a) shall be disregarded.” (2) Credits or refunds.— Subsection (b)(2) of section 6416 (relating to special cases in which tax payments are considered overpayments) is amended by adding at the end thereof the following new subparagraph: “(R) in the case of a bus chassis or body taxable under section 4061(a), sold to any person for use as described in section 4221(e)(5).” (e) Effective Dates.—The amendments made by subsections (a), (b), and (d) shall apply with respect to articles sold on or after the day after the date of the enactment of this Act. The amendment made by subsection (c) shall apply with respect to articles sold on or after January 1, 1965.