LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE
75th Regular Session
March 17, 1997
TO: Honorable Pete Patterson, Chair IN RE: House Bill No. 2011
Committee on Agriculture & Livestock By: Patterson, L.P. "Pete"
House
Austin, Texas
FROM: John Keel, Director
In response to your request for a Fiscal Note on HB2011 ( Relating
to the promotion of Texas agricultural products and the sale
of wine; creating a vintner's permit; imposing a tax on the
sale of wine; providing penalties.) this office has detemined
the following:
Biennial Net Impact to General Revenue Funds by HB2011-As Introduced
Implementing the provisions of the bill would result in a
net negative impact of $(972,098) to General Revenue Related
Funds through the biennium ending August 31, 1999.
The bill would make no appropriation but could provide the legal
basis for an appropriation of funds to implement the provisions
of the bill.
Fiscal Analysis
The bill would make several changes in the Alcoholic Beverage
Code relating to the promotion, sale, and taxation of wine,
by establishing a new $300 Vintner's Permit and creating a retail
tax of one cent per 750 milliliters (ml) of wine sold.
The
tax would be paid monthly to the Texas Department of Agriculture
(TDA) by permit holders authorized to sell wine at retail.
Revenue collected from the retail wine tax could be appropriated
only to TDA to promote research and market wine in Texas.
This
bill would take effect September 1, 1997.
Methodolgy
The revenue gain from the retail wine tax was estimated by translating
estimated wine excise tax revenue, which is taxed on a per gallon
basis, into an equivalent number of 750 ml containers and applying
the one cent per container retail wine tax rate. This figure
was adjusted for breakage, reporting and collection lags, and
possible tax evasion effects. Revenue from the retail wine
tax would be dedicated to the TDA's wine programs.
The costs
to administer the wine tax are based on auditing approximately
five percent of current permit holders authorized to sell wine
at retail, either for on-premises or off-premises consumption.
Most, if not all of them, would be required to pay this tax
and submit monthly reports to the TDA.
The probable fiscal implications of implementing the provisions
of the bill during each of the first five years following passage
are estimated as follows:
Five Year Impact:
Fiscal Year Probable Probable Revenue Change in Number
Savings/(Cost) Gain/(Loss) from of State
from General General Revenue Employees from
Revenue Fund Fund FY 1997
0001 0001
1998 ($1,364,799) $859,000 14.2
1998 (1,600,299) 1,134,000 14.2
2000 (1,613,299) 1,147,000 14.2
2001 (1,623,299) 1,157,000 14.2
2002 (1,634,299) 1,168,000 14.2
Net Impact on General Revenue Related Funds:
The probable fiscal implication to General Revenue related funds
during each of the first five years is estimated as follows:
Fiscal Year Probable Net Postive/(Negative)
General Revenue Related Funds
Funds
1998 ($505,799)
1999 (466,299)
2000 (466,299)
2001 (466,299)
2002 (466,299)
Similar annual fiscal implications would continue as long as
the provisions of the bill are in effect.
Source: Agencies: 551 Department of Agriculture
304 Comptroller of Public Accounts
458 Alcoholic Beverage Commission
LBB Staff: JK ,BB ,RT