BILL ANALYSIS



S.B. 403
By: Cain (Junell)
April 17, 1995
Committee Report (Amended)


BACKGROUND

Section 191.142, Tax Code, imposes a $200 tax, per year, on
attorneys licensed by the state. Currently, the tax is administered
by the comptroller rather than the Supreme Court.  The comptroller
has no authority to revoke a license for nonpayment; therefore,
some attorneys may ignore the fee and become delinquent.

PURPOSE

This bill grants the Supreme Court the authority to administer the
annual collection of the attorney tax, and requires the Supreme
Court to suspend the license of anyone who does not pay the tax. 
This bill would implement part of Gaining Ground recommendation
GG6. (GG6 would also restructure the tax as a fee)

RULEMAKING AUTHORITY

It is the committee's opinion that this bill does expressly grant
additional rulemaking authority to the State Bar of Texas, with
Supreme Court approval, in SECTION 1 of the bill.

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Subchapter H (Attorneys), Chapter 191
           (Miscellaneous Occupation Taxes), Tax Code, as follows:

           Amends Section 191.141 to add the definition of "state
           bar."

           Adds Section 191.1431 METHOD OF COLLECTION.  Requires
           the Supreme Court to administer the collection of taxes
           under this subchapter.

           Adds Section 191.1441 SUSPENSION AND REINSTATEMENT.  (a)
           Requires the Supreme Court to suspend from the practice
           of law a person who does not pay, within 90 days after
           the due date, the tax or a relating penalty.

           (b) Requires an attorney suspended under subsection (a)
           to be reinstated on payment of the tax and any interest
           and penalties.

           Adds Section 191.1442 PENALTY AND INTEREST.  (a)
           Requires a penalty of five percent of the tax due to be
           imposed on a person who fails to pay the tax or fails
           to file a report when due.  Requires an additional five
           percent penalty to be imposed if the person fails to
           file the report or pay the tax within 30 days after the
           tax or report is due.

           (b) Establishes the yearly interest rate on delinquent
           tax as 12 percent, beginning 60 days from the due date.

           Adds Section 191.1443 RULES.  Grants the State Bar of
           Texas, with Supreme Court approval, the authority to
           adopt policies and rules for the administration and
           collection of, and exemptions from, the tax.


           Amends Section 191.145 (Distribution of Tax) to require
           the Supreme Court to forward tax received to the state
           for deposit.

SECTION 2. Provides that all forms and policies adopted by the
           comptroller for the administration of Chapter 191, Tax
           Code, in effect on the effective date of this Act,
           remain in effect until amended or repealed by the State
           Bar of Texas.

SECTION 3. Provides that liability accruing before the effective
           date of this Act continues in effect, and that the
           former law is continued in effect for the collection of
           taxes due as of the effective date and for enforcement
           of the liability for those taxes.  Requires the
           comptroller, as soon as practicable on or after the
           effective date, to transfer all unpaid accounts and
           files to the Supreme Court of Texas.

SECTION 4. Effective Date:  June 1, 1995.

SECTION 5. Emergency Clause.

EXPLANATION OF AMENDMENTS

COMMITTEE AMENDMENT NO. 1 adds a new SECTION 4 to the bill, and
renumbers the remaining Sections accordingly.
SECTION 4, as amended, provides that any attorney tax proceedings
that are not final on the effective date of the transfer of
functions provided by this bill, remain under the jurisdiction of
the Comptroller.

SUMMARY OF COMMITTEE ACTION

Public notice was posted in accordance with the rules, and a public
hearing was held on April 11, 1995.  Representative Junell
explained the bill.  The Committee considered committee amendment
#1 by Representative Craddick.  Without objection, the committee
adopted committee amendment #1.  By a record vote of 9 ayes, 0
nays, 0 present not voting and 2 absent, the committee voted to
report S.B. 403 to the House as amended with the recommendation
that it do pass.

     Testimony received in favor of the bill:
           Antonio Alvarado, representing himself and the State Bar
           of Texas.