LEGISLATIVE BUDGET BOARD
                          Austin, Texas

                           FISCAL NOTE
                       74th Regular Session

                          March 14, 1995



 TO:     Honorable Senator John T. Montford,    IN RE:  Senate Bill No. 982
         Chair                                          By: Truan
         Committee on Finance
         Senate
         Austin, Texas







FROM: John Keel, Director

In response to your request for a Fiscal Note on Senate Bill No.
982 (Relating to the relationship of governmental entities
outside this state, particularly the United Mexican States, to
state tax provisions.) this office has determined the following:

This bill would amend the Sales Tax portion of the Tax Code to
include in the definition of a "sale for resale" the acquisition
of tangible personal property or taxable services by a purchaser
for resale in the United Mexican States.  The term "sale for
resale" would also be made to include the acquisition of tangible
personal property for lease or rental in the United Mexican
States, as well as tangible personal property purchased for the
purpose of transferring that property in the United Mexican
States as an integral part of a taxable service.

Currently, a person purchasing taxable items in Texas for resale
in foreign countries must pay both state and local sales taxes on
those purchases.  Upon securing acceptable documentation proving
that the items have been exported beyond the territorial limits
of the United States and pursuant to the U.S. Constitution, the
person may approach the Texas retailer where the items were
purchased and obtain a refund of sales taxes paid.

No significant fiscal implication to the State or units of local
government is anticipated.
        




    


 




Source:   LBB Staff: JK, SM, DF