KRS 132.020 — State ad valorem taxes

(1) The owner or person assessed shall pay an annual ad valorem tax for state purposes
at the rate of:
(a) Thirty-one and one-half cents ($0.315) upon each one hundred dollars ($100)
of value of all real property directed to be assessed for taxation;
(b) Twenty-five cents ($0.25) upon each one hundred dollars ($100) of value of
all motor vehicles qualifying for permanent registration as historic motor
vehicles under KRS 186.043;
(c) Fifteen cents ($0.15) upon each one hundred dollars ($100) of value of all:
1. Machinery actually engaged in manufacturing;
2. Commercial radio and television equipment used to receive, capture,
produce, edit, enhance, modify, process, store, convey, or transmit audio
or video content or electronic signals which are broadcast over th e air to
an antenna, including radio and television towers used to transmit or
facilitate the transmission of the signal broadcast and equipment used to
gather or transmit weather information, but excluding telephone and
cellular communication towers; and
3. Tangible personal property which has been certified as a pollution
control facility as defined in KRS 224.1 -300. In the case of tangible
personal property certified as a pollution control facility which is
incorporated into a landfill facility, the tang ible personal property shall
be presumed to remain tangible personal property for purposes of this
paragraph if the tangible personal property is being used for its intended
purposes;
(d) Ten cents ($0.10) upon each one hundred dollars ($100) of value on t he
operating property of railroads or railway companies that operate solely
within the Commonwealth;
(e) Five cents ($0.05) upon each one hundred dollars ($100) of value of goods
held for sale in the regular course of business, which includes:
1. Machinery and equipment held in a retailer's inventory for sale or lease
originating under a floor plan financing arrangement;
2. Motor vehicles:
a. Held for sale in the inventory of a licensed motor vehicle dealer,
including licensed motor vehicle auction dealers, which are not
currently titled and registered in Kentucky and are held on an
assignment pursuant to KRS 186A.230; or
b. That are in the possession of a licensed motor vehicle dealer,
including licensed motor vehicle auction dealers, for sale, although
ownership has not been transferred to the dealer;
3. Raw materials, which includes distilled spirits and dis tilled spirits
inventory;
4. In-process materials, which includes distilled spirits and distilled spirits
inventory, held for incorporation in finished goods held for sale in the
regular course of business; and
5. Qualified heavy equipment;
(f) One and one -half cents ($0.015) upon each one hundred dollars ($100) of
value of all:
1. Privately owned leasehold interests in industrial buildings, as defined
under KRS 103.200, owned and financed by a tax -exempt governmental
unit, or tax -exempt statutory authority under the provisions of KRS
Chapter 103, upon the prior approval of the Kentucky Economic
Development Finance Authority, except that the rate shall not apply to
the proportion of value of the leasehold interest created through any
private financing;
2. Qualifying voluntary environmental remediation property, provided the
property owner has corrected the effect of all known releases of
hazardous substances, pollutants, contaminants, petroleum, or petroleum
products located on the property consistent with a corrective action plan
approved by the Energy and Environment Cabinet pursuant to KRS
224.1-400, 224.1-405, or 224.60-135, and provided the cleanup was not
financed through a public grant or the petroleum storage tank
environmental assurance fund. This rate shall apply for a period of three
(3) years following the Energy and Environment Cabinet's issuance of a
No Further Action Letter or its equivalent, after which the regular tax
rate shall apply;
3. Tobacco directed to be assessed for taxation;
4. Unmanufactured agricultural products;
5. Aircraft not used in the business of transporting persons or property for
compensation or hire;
6. Federally documented vessels not used in the business of transporting
persons or property for compensation or hire, or for other commercial
purposes; and
7. Privately owned leasehold interests in residential property described in
KRS 132.195(2)(g); and
(g) Forty-five cents ($0.45) upon each one hundred dollars ($100) of value of all
other property directed to be assessed for t axation shall be paid by the owner
or person assessed, except as provided in KRS 132.030, 132.200, 136.300,
and 136.320, providing a different tax rate for particular property.
(2) Notwithstanding subsection (1)(a) of this section, the state tax rate on re al property
shall be reduced to compensate for any increase in the aggregate assessed value of
real property to the extent that the increase exceeds the preceding year's assessment
by more than four percent (4%), excluding:
(a) The assessment of new property as defined in KRS 132.010(8);
(b) The assessment from property which is subject to tax increment financing
pursuant to KRS Chapter 65; and
(c) The assessment from leasehold property which is owned and financed by a
tax-exempt governmental unit, or tax -exempt statutory authority under the
provisions of KRS Chapter 103 and entitled to the reduced rate of one and
one-half cents ($0.015) pursuant to subsection (1)(f) of this section. In any
year in which the aggregate assessed value of real property is less than the
preceding year, the state rate shall be increased to the extent necessary to
produce the approximate amount of revenue that was produced in the
preceding year from real property.
(3) By July 1 each year, the department shall compute the state tax rate applicable to
real property for the current year in accordance with the provisions of subsection
(2) of this section and certify the rate to the county clerks for their use in preparing
the tax bills. If the assessments for all counties have not been certified by July 1, the
department shall, when either real property assessments of at least seventy -five
percent (75%) of the total number of counties of the Commonwealth have been
determined to be acceptable by the department, or when the number of count ies
having at least seventy -five percent (75%) of the total real property assessment for
the previous year have been determined to be acceptable by the department, make
an estimate of the real property assessments of the uncertified counties and compute
the state tax rate.
(4) If the tax rate set by the department as provided in subsection (2) of this section
produces more than a four percent (4%) increase in real property tax revenues,
excluding:
(a) The revenue resulting from new property as defined in KRS 132.010(8);
(b) The revenue from property which is subject to tax increment financing
pursuant to KRS Chapter 65; and
(c) The revenue from leasehold property which is owned and financed by a tax -
exempt governmental unit, or tax -exempt statutory authority under the
provisions of KRS Chapter 103 and entitled to the reduced rate of one and
one-half cents ($0.015) pursuant to subsection (1) of this section;
the rate shall be adjusted in the succe eding year so that the cumulative total of each
year's property tax revenue increase shall not exceed four percent (4%) per year.
(5) The provisions of subsection (2) of this section notwithstanding, the assessed value
of unmined coal certified by the department after July 1, 1994, shall not be included
with the assessed value of other real property in determining the state real property
tax rate. All omitted unmined coal assessments made after July 1, 1994, shall also
be excluded from the provisions of sub section (2) of this section. The calculated
rate shall, however, be applied to unmined coal property, and the state revenue shall
be devoted to the program described in KRS 146.550 to 146.570, except that four
hundred thousand dollars ($400,000) of the sta te revenue shall be paid annually to
the State Treasury and credited to the Office of Energy Policy for the purpose of
public education of coal-related issues.