1-1 By: Shapleigh, Ellis, Armbrister S.B. No. 1778 1-2 (In the Senate - Filed March 14, 1997; March 24, 1997, read 1-3 first time and referred to Committee on Finance; April 9, 1997, 1-4 reported adversely, with favorable Committee Substitute by the 1-5 following vote: Yeas 11, Nays 1; April 9, 1997, sent to printer.) 1-6 COMMITTEE SUBSTITUTE FOR S.B. No. 1778 By: Truan, Moncrief 1-7 A BILL TO BE ENTITLED 1-8 AN ACT 1-9 relating to reports on and analyses of tax impacts. 1-10 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-11 SECTION 1. Subchapter B, Chapter 403, Government Code, is 1-12 amended by adding Section 403.0141 to read as follows: 1-13 Sec. 403.0141. REPORT ON INCIDENCE OF TAX. (a) Before each 1-14 regular session of the legislature, the comptroller shall report to 1-15 the legislature and the governor on the overall incidence of the 1-16 school district property tax and any state tax generating more than 1-17 2.5 percent of state tax revenue in the prior fiscal year. The 1-18 analysis shall report on the distribution of the tax burden for the 1-19 taxes included in the report. 1-20 (b) At the request of the chair of a committee of the senate 1-21 or house of representatives to which has been referred a bill or 1-22 resolution to change the tax system which would increase, decrease, 1-23 or redistribute tax by more than $20,000,000, the Legislative 1-24 Budget Board with the assistance, as requested, of the comptroller 1-25 shall prepare an incidence impact analysis of the bill or 1-26 resolution. The analysis shall report on the incidence effects 1-27 that would result if the bill or resolution were enacted. 1-28 (c) To the extent data is available, the incidence impact 1-29 analysis under Subsections (a) and (b): 1-30 (1) shall evaluate the tax burden: 1-31 (A) on the overall income distribution, using a 1-32 systemwide incidence measure or other appropriate measures of 1-33 equality and inequality; and 1-34 (B) on income classes, including, at a minimum, 1-35 quintiles of the income distribution, on renters and homeowners and 1-36 on industry or business classes, as appropriate, as well as on 1-37 various types of business organizations; 1-38 (2) may evaluate the tax burden: 1-39 (A) by other appropriate taxpayer 1-40 characteristics, such as whether the taxpayer is a farmer, rancher, 1-41 retired elderly, or resident or nonresident of the state; and 1-42 (B) by distribution of impact on consumers, 1-43 labor, capital, and out-of-state persons and entities; and 1-44 (3) shall: 1-45 (A) use the broadest measure of economic income 1-46 for which reliable data is available; and 1-47 (B) include a statement of the incidence 1-48 assumptions that were used in making the analysis. 1-49 SECTION 2. This Act takes effect September 1, 1997. 1-50 SECTION 3. The importance of this legislation and the 1-51 crowded condition of the calendars in both houses create an 1-52 emergency and an imperative public necessity that the 1-53 constitutional rule requiring bills to be read on three several 1-54 days in each house be suspended, and this rule is hereby suspended. 1-55 * * * * *