By Greenberg H.B. No. 1753 75R5168 DAK-D A BILL TO BE ENTITLED 1-1 AN ACT 1-2 relating to exempting certain purchases of machinery and equipment 1-3 used for research and development from sales and use taxes. 1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-5 SECTION 1. Subchapter H, Chapter 151, Tax Code, is amended 1-6 by adding Section 151.3181 to read as follows: 1-7 Sec. 151.3181. EQUIPMENT USED IN RESEARCH OR DEVELOPMENT. 1-8 (a) There are exempted from the taxes imposed by this chapter 1-9 machinery, equipment, or replacement parts that are used directly 1-10 in the research or development of inventions, products, processes, 1-11 or technology by a person that is primarily engaged in: 1-12 (1) the manufacturing, processing, or fabrication of 1-13 tangible personal property for ultimate sale; or 1-14 (2) the performance of scientific or technical 1-15 services for a person described by Subdivision (1). 1-16 (b) The exemption does not include: 1-17 (1) office equipment or supplies; or 1-18 (2) equipment or supplies used in sales or 1-19 distribution activities or in transportation activities. 1-20 (c) In this section, "manufacturing" has the meaning 1-21 assigned by Section 151.318. 1-22 SECTION 2. (a) This Act takes effect October 1, 1997. 1-23 (b) The change in law made by this Act does not affect taxes 1-24 imposed before the effective date of this Act, and the law in 2-1 effect before the effective date of this Act is continued in effect 2-2 for purposes of the liability for and collection of those taxes. 2-3 SECTION 3. The importance of this legislation and the 2-4 crowded condition of the calendars in both houses create an 2-5 emergency and an imperative public necessity that the 2-6 constitutional rule requiring bills to be read on three several 2-7 days in each house be suspended, and this rule is hereby suspended.