1-1  By:  Cain                                              S.B. No. 403
    1-2        (In the Senate - Filed February 13, 1995; February 14, 1995,
    1-3  read first time and referred to Committee on Finance;
    1-4  March 2, 1995, reported adversely, with favorable Committee
    1-5  Substitute by the following vote:  Yeas 12, Nays 0; March 2, 1995,
    1-6  sent to printer.)
    1-7  COMMITTEE SUBSTITUTE FOR S.B. No. 403                 By:  Moncrief
    1-8                         A BILL TO BE ENTITLED
    1-9                                AN ACT
   1-10  relating to the occupation tax imposed on attorneys.
   1-12        SECTION 1.  Subchapter H, Chapter 191, Tax Code, is amended
   1-13  to read as follows:
   1-14                       SUBCHAPTER H.  ATTORNEYS
   1-15        Sec. 191.141.  Definitions.  In this subchapter:
   1-16              (1)  "Attorney" means a person licensed to practice law
   1-17  in this state.
   1-18              (2)  "Tax year" means June 1 of one year through May 31
   1-19  of the following year.
   1-20              (3)  "State bar" means the State Bar of Texas, acting
   1-21  as the administrative arm for the Supreme Court of Texas.
   1-22        Sec. 191.142.  Imposition and Rate of Tax.  (a)  A tax is
   1-23  imposed on each attorney.
   1-24        (b)  The tax rate is $200 per year to be paid in advance.
   1-25        Sec. 191.143.  Time for Payment of Tax.  (a)  Except as
   1-26  provided by Subsection (b), each attorney shall pay the tax for
   1-27  each tax year on or before June 1 of the tax year.
   1-28        (b)  If a person is licensed to practice law after the
   1-29  beginning of the tax year or resumes active status to practice law
   1-30  after the beginning of the tax year, the person being licensed or
   1-31  resuming active status shall pay the tax imposed by this subchapter
   1-32  in proportion to the number of months for which the person will be
   1-33  licensed during that tax year.  If a person is licensed after the
   1-34  beginning of a calendar month, the month in which the person is
   1-35  licensed shall count as a month for purposes of payment of taxes
   1-36  under this subsection.
   1-37        Sec. 191.1431.  METHOD OF COLLECTION.  The supreme court,
   1-38  through its administrative arm, the state bar, shall administer the
   1-39  collection of taxes under this subchapter.
   1-40        Sec. 191.144.  Exemptions.  The tax imposed by this
   1-41  subchapter does not apply to:
   1-42              (1)  an attorney who is 70 years of age or older; or
   1-43              (2)  an attorney who has assumed inactive status under
   1-44  rules governing the licensing of attorneys in this state.
   1-45        Sec. 191.1441.  SUSPENSION AND REINSTATEMENT.  (a)  The
   1-46  supreme court shall suspend from the practice of law a person who
   1-47  does not pay, within 90 days after the date it is due, the tax
   1-48  imposed by this subchapter or a penalty relating to that tax.
   1-49        (b)  An attorney who is suspended under Subsection (a) shall
   1-50  be reinstated on payment of the tax and any interest and penalties.
   1-51        Sec. 191.1442.  PENALTY AND INTEREST.  (a)  A penalty of five
   1-52  percent of the tax due shall be imposed on a person who fails to
   1-53  pay the tax imposed or file a report required by this chapter when
   1-54  due, and, if the person fails to file the report or pay the tax
   1-55  within 30 days after the day on which the tax or report is due, an
   1-56  additional five percent penalty shall be imposed.
   1-57        (b)  The yearly interest rate on delinquent tax imposed by
   1-58  this chapter is 12 percent.  Delinquent taxes draw interest
   1-59  beginning 60 days from the due date.
   1-60        (c)  The state bar may settle a claim for penalty or interest
   1-61  imposed under this section if the attorney exercised reasonable
   1-62  diligence to comply with the provisions of this subchapter.
   1-63        Sec. 191.1443.  RULES.  The state bar, with the approval of
   1-64  the supreme court, shall have the authority to adopt policies and
   1-65  rules for the administration and collection of and for exemptions
   1-66  from the tax imposed by this chapter.
   1-67        Sec. 191.145.  DISTRIBUTION OF TAX.  The state bar shall
   1-68  forward tax received under this subchapter to the state for deposit
    2-1  as follows:
    2-2              (1)  25 <(a)  Twenty-five> percent of the taxes
    2-3  <collected under this subchapter in any tax year> shall be
    2-4  deposited to the credit of the foundation school fund; and<.>
    2-5              (2)  75 <(b)  Seventy-five> percent of the taxes
    2-6  <collected under this subchapter in any tax year> shall be
    2-7  deposited to the credit of the general revenue fund.
    2-8        SECTION 2.  All forms and policies adopted by the comptroller
    2-9  specifically for the administration of Chapter 191, Tax Code, in
   2-10  effect on the effective date of this Act remain in effect until
   2-11  amended or repealed by the State Bar of Texas under authority
   2-12  granted to the State Bar of Texas by a change in law made by this
   2-13  Act or other law.
   2-14        SECTION 3.  The change in law made by this Act does not
   2-15  affect tax liability accruing before the effective date of this
   2-16  Act.  That liability continues in effect as if this Act had not
   2-17  been enacted, and the former law is continued in effect for the
   2-18  collection of taxes due as of the effective date of this Act and
   2-19  for enforcement of the liability for those taxes.  However, as soon
   2-20  as practicable on or after the effective date of this Act, the
   2-21  comptroller shall transfer to the State Bar of Texas all unpaid
   2-22  accounts and files.
   2-23        SECTION 4.  This Act takes effect June 1, 1995.
   2-24        SECTION 5.  The importance of this legislation and the
   2-25  crowded condition of the calendars in both houses create an
   2-26  emergency and an imperative public necessity that the
   2-27  constitutional rule requiring bills to be read on three several
   2-28  days in each house be suspended, and this rule is hereby suspended,
   2-29  and that this Act take effect and be in force according to its
   2-30  terms, and it is so enacted.
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