Hm interesting. The BMW wiki has the following description for its Owner’s Choice option:
Alternative Financial Products - Owners Choice (for TX, GA, IL)
BMW has a special financial product for Texas, Georgia and Illinois called Owners Choice which is similar to a balloon loan but with the advantages of a lease. It was intended to circumvent the issues related to customers potentially paying double tax on a lease and then taxed again on the vehicle buyout. Owners Choice puts the vehicle registration under the customers name to avoid the double taxation, this means for PHEV’s that have not been registered that the customer can benefit from the Federal and State tax rebates creating some of the best deals possible.
I think 3.70(b) and © of the Admin Code are maybe getting at that situation where the lease is viewed as a purchase by the state whereas clause (d) appears to say if there was nothing to suggest the lease was truly a purchase at the outset you might get dinged again:
“(d) If the motor vehicle is sold to a person not privy to the lease or if it is sold to the lessee at fair market value, the amount subject to the motor vehicle sales and use tax is the agreed-upon sales price. (See Attorney General Opinion WW-711 (1959).)”
So I think there is some risk in Texas absent a special financing arrangement.