By Ratliff                                       S.B. No. 767

      75R4732 CBH-F                           

                                A BILL TO BE ENTITLED

 1-1                                   AN ACT

 1-2     relating to the application of the sales and use tax to certain

 1-3     materials used in commercial timber operations.

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

 1-5           SECTION 1.  Section 151.3161, Tax Code, is amended by

 1-6     amending Subsection (c) and adding Subsection (d) to read as

 1-7     follows:

 1-8           (c)  A fertilizer, fungicide, insecticide, herbicide,

 1-9     defoliant, or desiccant used exclusively in a commercial timber

1-10     operation to produce  timber products to be sold in the regular

1-11     course of business of the commercial timber operation is exempted

1-12     from the tax imposed by this chapter.

1-13           (d)  In this section, "machinery or equipment" means only

1-14     complete systems or units that operate or perform a particular

1-15     function independently of other units or components.  The term does

1-16     not include:

1-17                 (1)  repair or replacement parts, modules, accessories,

1-18     or components; or

1-19                 (2)  handheld manual or power tools, including chain

1-20     saws and axes.

1-21           SECTION 2.  (a)  This Act takes effect on the first day of

1-22     the first calendar quarter beginning on or after the earliest date

1-23     that it may take effect under Section 39, Article III, Texas

1-24     Constitution.

 2-1           (b)  The change in law made by this Act does not affect taxes

 2-2     imposed before the effective date of this Act, and the law in

 2-3     effect before that date is continued in effect for purposes of the

 2-4     liability for and collection of those taxes.

 2-5           SECTION 3.  The importance of this legislation and the

 2-6     crowded condition of the calendars in both houses create an

 2-7     emergency and an imperative public necessity that the

 2-8     constitutional rule requiring bills to be read on three several

 2-9     days in each house be suspended, and this rule is hereby suspended,

2-10     and that this Act take effect and be in force according to its

2-11     terms, and it is so enacted.