LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE
74th Regular Session
February 28, 1995
TO: Honorable Tom Craddick, Chair IN RE: House Bill No. 462
Committee on Ways & Means By: Alvarado,
House of Representatives Raymond
Austin, Texas
FROM: John Keel, Director
In response to your request for a Fiscal Note on House Bill No.
462 (Relating to the application of the sales and use tax to food
products sold to prison inmates.; Relating to the application of
the sales and use tax to food products sold to prison inmates.)
this office has determined the following:
This bill would eliminate the sales tax exemption for food
products, meals, soft drinks, and candy sold to inmates of public
and privately-operated prisons and other correctional
institutions, including county jails. This bill would have no
effect on the patients of state licensed or operated hospitals,
who are also currently exempt.
Using fiscal 1992 sales and use tax reports prepared by the Texas
Department of Criminal Justice (TDCJ), the annual sales volume of
items affected by this bill was estimated to be $59.82 per
inmate. This figure was multiplied by the projected number of
TDCJ and county jail inmates for the five-year period, 1996-2000.
Additionally, the gains for fiscal 1996 were adjusted downward to
adjust for the proposed October 1, 1995 effective date.
The probable fiscal implication of implementing the provisions of
the bill during each of the first five years following passage
is estimated as follows:
Fiscal Probable Revenue Probable Revenue
Year Gain to the Gain to Local
General Revenue Governments
Fund 001
1996 $688,000 $166,000
1997 833,000 201,000
1998 930,000 225,000
1999 962,000 233,000
2000 995,000 241,000
Similar annual fiscal implications would continue as long as the
provisions of the bill are in effect.
Source: Comptroller of Public Accounts, Department of Criminal
Justice
LBB Staff: JK, SM, DF