SRC-PNG H.B. 2372 76(R)   BILL ANALYSIS


Senate Research Center   H.B. 2372
By: Gutierrez (Ellis)
Finance
5/11/1999
Engrossed


DIGEST 

Currently, purchases of over-the-counter medication are taxed.  Many
families without insurance often are forced to rely on these
over-the-counter medications because they cannot afford to see a doctor.
Additionally, many doctors are suggesting using newly available
over-the-counter medications rather than prescription medicine.  This bill
would eliminate sales tax on medication that is labeled with a national
drug code issued by the federal Food and Drug Administration and blood
glucose monitoring strips. 

PURPOSE

As proposed, H.B. 2372 eliminates sales tax on medication that is labeled
with a national drug code issued by the federal Food and Drug
Administration and blood glucose monitoring strips. 

RULEMAKING AUTHORITY

This bill does not grant any additional rulemaking authority to a state
officer, institution, or agency. 

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Section 151.313(a), Tax Code, to exempt from taxes
imposed by this chapter a drug or medicine, without regard to whether it is
prescribed or dispensed by a licensed practitioner of the healing arts,
that is labeled with a national drug code issued by the federal Food and
Drug Administration, and blood glucose monitoring test strips.  Makes
conforming changes. 

SECTION 2. (a) Authorizes the governing body of a local taxing authority
that imposes a local sales and use tax to repeal an exemption if the
governing body finds by an appropriate order that the exemption would
materially impair the obligation of an existing contract at the effective
date of this Act and to which the local taxing authority is a party. 

(b) Requires the secretary of the local taxing authority adopting an order
under this section to send to the comptroller of public accounts
(comptroller) by certified or registered mail a copy of the order. 

(c) Provides that the repeal of the exemption takes effect on the first day
of the month following the expiration of the calendar quarter occurring
after the date on which the comptroller receives a copy of the order. 

SECTION 3. (a) Effective date: The first day of the first calendar quarter
after the 90th day after   adjournment. 

(b) Makes application of this Act prospective.

SECTION 4. Emergency clause.