By Hirschi                                      H.B. No. 2844

      75R8625 DAK-D                           

                                A BILL TO BE ENTITLED

 1-1                                   AN ACT

 1-2     relating to increasing the tax on cigarettes, cigars, and other

 1-3     tobacco products to fund public elementary and secondary schools.

 1-4           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

 1-5           SECTION 1.  Section 154.021(b), Tax Code, is amended to read

 1-6     as follows:

 1-7           (b)  The tax rates are:

 1-8                 (1)  $33 [$20.50] per thousand on cigarettes weighing

 1-9     three pounds or less per thousand; and

1-10                 (2)  the rate provided by Subdivision (1) plus $2.10

1-11     per thousand on cigarettes weighing more than three pounds per

1-12     thousand.

1-13           SECTION 2.  Section 154.603(b), Tax Code, is amended to read

1-14     as follows:

1-15           (b)  The revenue remaining after the deductions for the

1-16     purposes provided by Section 154.602 of this code and allocation

1-17     under Subsection (a) of this section is allocated as follows:

1-18                 (1)  $12.50 per thousand cigarettes to be spent only

1-19     for elementary and secondary public school purposes; and

1-20                 (2)  the remainder to the general revenue fund.

1-21           SECTION 3.  Section 155.021(b), Tax Code, is amended to read

1-22     as follows:

1-23           (b)  The tax rates are:

1-24                 (1)  1.125 cents [one cent] per 10 or fraction of 10 on

 2-1     cigars weighing three pounds or less per thousand;

 2-2                 (2)  $8.4375 [$7.50] per thousand on cigars that:

 2-3                       (A)  weigh more than three pounds per thousand;

 2-4     and

 2-5                       (B)  sell at factory list price, exclusive of any

 2-6     trade discount, special discount, or deal, for 3.3 cents or less

 2-7     each;

 2-8                 (3)  $12.375 [$11] per thousand on cigars that:

 2-9                       (A)  weigh more than three pounds per thousand;

2-10                       (B)  sell at factory list price, exclusive of any

2-11     trade discount, special discount, or deal, for more than 3.3 cents

2-12     each; and

2-13                       (C)  contain no substantial amount of nontobacco

2-14     ingredients; and

2-15                 (4)  $16.875 [$15] per thousand on cigars that:

2-16                       (A)  weigh more than three pounds per thousand;

2-17                       (B)  sell at factory list price, exclusive of any

2-18     trade discount, special discount, or deal, for more than 3.3 cents

2-19     each; and

2-20                       (C)  contain a substantial amount of nontobacco

2-21     ingredients.

2-22           SECTION 4.  Section 155.0211(b), Tax Code, is amended to read

2-23     as follows:

2-24           (b)  The tax rate for tobacco products other than cigars is

2-25     39.615 [35.213] percent of the manufacturer's list price, exclusive

2-26     of any trade discount, special discount, or deal.

2-27           SECTION 5.  Section 155.241, Tax Code, is amended to read as

 3-1     follows:

 3-2           Sec. 155.241.  ALLOCATION OF TAX.  Revenue collected under

 3-3     this chapter shall be allocated as follows:

 3-4                 (1)  revenue from any increase in the rate of a tax

 3-5     under this chapter effective on or after September 1, 1997, to be

 3-6     spent only for elementary and secondary public school purposes; and

 3-7                 (2)  the remainder [deposited] to the credit of the

 3-8     general revenue fund.

 3-9           SECTION 6.  (a)  This Act takes effect September 1, 1997.

3-10           (b)  The change in law made by this Act does not affect taxes

3-11     imposed before the effective date of this Act, and the law in

3-12     effect before the effective date of this Act is continued in effect

3-13     for purposes of the liability for and collection of those taxes.

3-14           SECTION 7.  The importance of this legislation and the

3-15     crowded condition of the calendars in both houses create an

3-16     emergency and an imperative public necessity that the

3-17     constitutional rule requiring bills to be read on three several

3-18     days in each house be suspended, and this rule is hereby suspended.