TREATMENT OF LONG-TERM LESSORS OF HEAVY TRUCKS AND TRAILERS.

SEC. 505. TREATMENT OF LONG-TERM LESSORS OF HEAVY TRUCKS AND TRAILERS. (a) Initial Tax Not Imposed on Sale to Long-Term Lessors.—Paragraph (1) of section 4052(a) of the Internal Revenue Code of 1986 (defining first retail sale) is amended by striking out “other than for resale” and inserting in lieu thereof “other than for resale or leasing in a long-term lease”. (b) Constructive Sales Price in the Case of Long-Term Lease.—Subsection (b) of section 4052 of such Code (defining price) is amended by adding at the end thereof the following new paragraph: “(3) Long-term lease.— “(A) In general.—In the case of any long-term lease of an article which is treated as the first retail sale of such article, the tax under this subchapter shall be computed on a price equal to— “(i) the sum of— “(I) the price (determined under this subchapter but without regard to paragraph (4)) at which such article was sold to the lessor, and “(II) the cost of any parts and accessories installed by the lessor on such article before the first use by the lessee or leased in connection with such long-term lease, plus 101 STAT. 259 “(ii) an amount equal to the presumed markup percentage of the sum described in clause (i). “(B) Presumed markup percentage.—For purposes of subparagraph (A), the term ‘presumed markup percentage’ means the average markup percentage of retailers of articles of the type involved, as determined by the Secretary. “(C) Exceptions under regulations.—To the extent provided in regulations prescribed by the Secretary, subparagraph (A) shall not apply to specified types of leases where its application is not necessary to carry out the purposes of this subsection.” (c) Long-Term Lease Defined.—Section 4052 of such Code is amended by adding at the end thereof the following new subsection: “(f) Long-Term Lease.—For purposes of this section, the term ‘long-term lease’ means any lease with a term of 1 year or more. In determining a lease term for purposes of the preceding sentence, the rules of section 168(i)(3)(A) shall apply.” (d) Effective Date.—The amendments made by this section shall apply with respect to articles sold by the manufacturer, producer, or importer on or after the first day of the first calendar quarter which begins more than 90 days after the date of the enactment of this Act.