BILL ANALYSIS C.S.H.B. 2600 By: Kubiak 4-21-95 Committee Report (Substituted) BACKGROUND Federal Employees who are licensed by the state are being taxed inconsistently according to applicable statutes. For example, attorneys employed by the federal government do not pay their occupation tax which is directly collected by the State Comptroller. The Comptroller determined administratively that federally employed attorneys are not subject to this tax. However, Certified Public Accountants (CPA's) employed by the federal government, and specifically prohibited from outside employment, are not exempt from their occupation tax due to language in the Public Accountancy Act. PURPOSE CSHB 2600 amends the Public Accountancy Act of 1991 to allow for the exemption of certain fees by federally employed CPAs, and those employed by certain state agencies. RULEMAKING AUTHORITY It is the committee's opinion that this bill does not grant any additional rulemaking authority to a state officer, institution, or agency. SECTION BY SECTION ANALYSIS SECTION 1. Amends Section 9A, Public Accountancy Act of 1991 (Art. 41a-1, Vernons Texas Civil Statutes) Adds Subsection (d)and (e). Allows exemption for licensed CPAs who are employed by the federal government (and restricted from outside employment) from the imposition of fees contained in Subsections (a) and (b). Also grants exemption to employees of certain state agencies. SECTION 2. Act applies to fees becoming due on or after the effective date. SECTION 3. Emergency clause. COMPARISON OF ORIGINAL TO SUBSTITUTE The substituted added language exempting those federal employees who are restricted, by virtue of employment from engaging in public accounting outside the scope of employment. The original did not provide for this. The substitute also exempts employees of state agencies that have authorized the payment of such fees on behalf of the license holder. The original did not provide for this. SUMMARY OF COMMITTEE ACTION HB 2600 was posted for Public Hearing on March 22, 1995. The Public Hearing was cancelled. HB 2600 was considered in a Public Hearing on March 29, 1995. The Chair laid out and explained HB 2600. The Chair recognized the following persons to testify in favor of the bill. Mr. James L. Walker, CPA, IRS; HB 2600 was left pending in committee. There was no objection. HB 2600 was considered in a Public Hearing on April 19, 1995. The Chair laid out HB 2600 which was pending in committee. There was no objection. Rep. Goolsby offered a complete committee substitute and moved that the full committee adopt CSHB 2600. There was no objection. HB 2600 was left pending in committee. There was no objection. HB 2600 was considered in a Formal Meeting on April 21, 1995. The Chair laid out HB 2600 as substituted which was pending in committee. There was no objection. Rep. Kubiak moved that the full committee adopt HB 2600 as substituted and that it be reported favorably to the full House with the recommendation that it do pass and be printed, and placed on the Local and Consent Calendar. The motion prevailed by the following vote: AYES: 8, NAYS: 0, ABSENT: 1.