By Swinford, et al. H.B. No. 398 A BILL TO BE ENTITLED 1-1 AN ACT 1-2 relating to exempting certain underground irrigation systems from 1-3 the sales tax. 1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-5 SECTION 1. Section 151.316, Tax Code, is amended to read as 1-6 follows: 1-7 Sec. 151.316. Agricultural Items. (a) The following items 1-8 are exempted from the taxes imposed by this chapter: 1-9 (1) horses, mules, and work animals; 1-10 (2) animal life the products of which ordinarily 1-11 constitute food for human consumption; 1-12 (3) feed for farm and ranch animals; 1-13 (4) feed for animals that are held for sale in the 1-14 regular course of business; 1-15 (5) seeds and annual plants the products of which: 1-16 (A) ordinarily constitute food for human 1-17 consumption; 1-18 (B) are to be sold in the regular course of 1-19 business; or 1-20 (C) are used to produce feed for animals 1-21 exempted by this section; 1-22 (6) fertilizers, fungicides, insecticides, herbicides, 1-23 defoliants, and desiccants exclusively used or employed on a farm 1-24 or ranch in the production of: 2-1 (A) food for human consumption; 2-2 (B) feed for animal life; or 2-3 (C) other agricultural products to be sold in 2-4 the regular course of business; 2-5 (7) machinery and equipment exclusively used or 2-6 employed on a farm or ranch in the building or maintaining of roads 2-7 or water facilities or in the production of: 2-8 (A) food for human consumption; 2-9 (B) grass; 2-10 (C) feed for animal life; or 2-11 (D) other agricultural products to be sold in 2-12 the regular course of business; 2-13 (8) machinery and equipment exclusively used in the 2-14 processing, packing, or marketing of agricultural products by the 2-15 original producer at a location operated by the original producer 2-16 exclusively for processing, packing, or marketing the producer's 2-17 own products; and 2-18 (9) ice exclusively used by commercial fishing boats 2-19 in the storing of aquatic species including but not limited to 2-20 shrimp, other crustaceans, finfish, mollusks, and other similar 2-21 creatures. 2-22 (b) Tangible personal property sold or used to be installed 2-23 as a component of an underground irrigation system is exempt from 2-24 the taxes imposed by this chapter if the system is exclusively used 2-25 or employed on a farm or ranch in the production of: 2-26 (1) food for human consumption; 2-27 (2) grass; 3-1 (3) feed or forage for: 3-2 (A) animal life the products of which ordinarily 3-3 constitute food for human consumption; or 3-4 (B) horses, mules, and work animals; or 3-5 (4) other agricultural products to be sold in the 3-6 regular course of business. 3-7 SECTION 2. (a) This Act takes effect on the first day of 3-8 the first calendar quarter beginning on or after the date that this 3-9 Act becomes law. 3-10 (b) The change in law made by this Act does not affect taxes 3-11 imposed before the effective date of this Act, and the law in 3-12 effect before the effective date of this Act is continued in effect 3-13 for purposes of the liability for and collection of those taxes. 3-14 SECTION 3. The importance of this legislation and the 3-15 crowded condition of the calendars in both houses create an 3-16 emergency and an imperative public necessity that the 3-17 constitutional rule requiring bills to be read on three several 3-18 days in each house be suspended, and this rule is hereby suspended, 3-19 and that this Act take effect and be in force from and after its 3-20 passage, and it is so enacted.