By Cuellar H.B. No. 2406
76R1539 CBH-D
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the exemption under the sales and use tax for property
1-3 exported beyond the territorial limits of the United States.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Sections 151.157(c), (e), (g), and (h), Tax Code,
1-6 are amended to read as follows:
1-7 (c) A customs broker may not have more than five places of
1-8 business in this state. The comptroller shall set the fee for a
1-9 license in an amount that does not exceed $100 for each customs
1-10 broker, without regard to whether the broker has more than one
1-11 place of business. The fee may be imposed only once for each
1-12 broker. The comptroller shall use the fees only for the
1-13 administration of this section, including costs of materials,
1-14 labor, and overhead.
1-15 (e) A customs broker licensed under this section shall make
1-16 available to the comptroller, on or after the 15th day after the
1-17 date the broker receives written notice from the comptroller, the
1-18 customs broker's books and records relating to the business of
1-19 issuing documentation certifying the export of tangible personal
1-20 property beyond the territorial limits of the United States for
1-21 purposes of exempting the property from the taxes imposed by this
1-22 chapter. The customs broker shall make available to the
1-23 comptroller, without notice from the comptroller, the customs
1-24 broker's books and records if the comptroller determines that the
2-1 comptroller's ability to administer and enforce effectively the
2-2 provisions of this chapter relating to documentation for the
2-3 purpose of showing the exemption of tangible personal property
2-4 under Section 151.307(b)(2) is jeopardized by providing notice.
2-5 The customs broker shall keep the books and records described by
2-6 this subsection for at least three [two] years after the date of
2-7 the last entry that they contain.
2-8 (g) [A customs broker may authorize a person to act as an
2-9 independent contractor to certify that tangible personal property
2-10 has been exported outside of the United States only if the
2-11 authorization is part of the written contract and the comptroller
2-12 in writing approves the authorization. A customs broker may not
2-13 authorize a person under this subsection to prepare documentation
2-14 for the purpose of showing the exemption for tangible personal
2-15 property under Section 151.307(b)(2).]
2-16 [(h)] In this section:
2-17 (1) "Customs broker" means a person licensed by the
2-18 United States Customs Service to act as a customs house broker.
2-19 (2) "Authorized employee" means an employee of a
2-20 customs broker:
2-21 (A) who is authorized by the broker to perform
2-22 customs transactions on behalf of the broker;
2-23 (B) who is compensated by the broker with a
2-24 regular salary or wages;
2-25 (C) who is under the direct control and
2-26 supervision of the broker; and
2-27 (D) from whose salary or wages the broker is
3-1 required to and actually does deduct and withhold a tax under
3-2 federal law.
3-3 SECTION 2. Subchapter E, Chapter 151, Tax Code, is amended
3-4 by adding Section 151.1575 to read as follows:
3-5 Sec. 151.1575. OFFICIAL VERIFICATION LOCATION. (a) A
3-6 person may apply for designation as an official verification
3-7 location if the person:
3-8 (1) applies to the comptroller for the designation;
3-9 (2) pays the fee set by the comptroller;
3-10 (3) posts a bond or security in the amount prescribed
3-11 by the comptroller; and
3-12 (4) complies with any rules prescribed by the
3-13 comptroller to administer this section and to prevent the evasion
3-14 of the tax under this chapter and local sales and use taxes.
3-15 (b) The comptroller shall request a municipality to
3-16 designate one person in the municipality it considers appropriate
3-17 as the only official verification location in that municipality.
3-18 On approval by the governing body of a municipality, the
3-19 comptroller may designate that person in that municipality as the
3-20 only official verification location in that municipality. The
3-21 comptroller by rule shall prescribe qualifications for designation
3-22 and the procedures for designation. The comptroller shall give
3-23 priority to applicants who propose locating at an airport or close
3-24 to the border between this state and the United Mexican States. If
3-25 the comptroller designates one location under this subsection, the
3-26 contract required by Subsection (c) between the location and each
3-27 customs broker must provide that the customs broker will pay the
4-1 monthly costs of the location in accordance with the ratio that the
4-2 number of export vouchers submitted to that location by the broker
4-3 during that month bears to the total number of export vouchers
4-4 submitted to that location by all brokers during that month.
4-5 (c) Each customs broker doing business in a municipality
4-6 shall contract with an official verification location in the
4-7 municipality to verify that tangible personal property is exported
4-8 outside this state. The comptroller in writing must approve the
4-9 contract.
4-10 (d) The comptroller shall assign each customs broker in a
4-11 municipality a unique color or other designation that the broker
4-12 must use in printing export vouchers. On receipt of an export
4-13 voucher, the official verification location with whom the customs
4-14 broker contracts shall verify that the tangible personal property
4-15 listed on the export voucher was actually exported outside this
4-16 state and, after the property is exported, attach to the export
4-17 voucher a stamp issued under Section 151.158 and return the stamped
4-18 export voucher to the customs broker.
4-19 (e) A customs broker may not issue documentation for the
4-20 purpose of showing the exemption of tangible personal property
4-21 under Section 151.307(b)(2) unless the broker receives a stamped
4-22 export voucher verifying exportation of that property in accordance
4-23 with Subsection (d). The customs broker shall attach the stamped
4-24 export voucher to the documentation.
4-25 (f) An official verification location shall make available
4-26 to the comptroller, on or after the 15th day after the date the
4-27 location receives written notice from the comptroller, the
5-1 location's books and records relating to the business of verifying
5-2 the export of tangible personal property beyond the territorial
5-3 limits of the United States for purposes of exempting the property
5-4 from the taxes imposed by this chapter. The location shall make
5-5 available to the comptroller, without notice from the comptroller,
5-6 the location's books and records if the comptroller determines that
5-7 the comptroller's ability to administer and enforce effectively the
5-8 provisions of this chapter relating to verification for the purpose
5-9 of showing the exemption of tangible personal property under
5-10 Section 151.307(b)(2) is jeopardized by providing notice. The
5-11 location shall keep the books and records described by this
5-12 subsection for at least three years after the date of the last
5-13 entry that they contain.
5-14 (g) Notwithstanding any other provision of this section, if
5-15 the comptroller does not designate any person as an official
5-16 verification location for a municipality, each customs broker doing
5-17 business in that municipality shall perform the duties of an
5-18 official verification location in relation to that broker's
5-19 business in that municipality.
5-20 SECTION 3. Sections 151.158(c), (e), and (f), Tax Code, are
5-21 amended to read as follows:
5-22 (c) The comptroller shall require that the stamps be
5-23 manufactured so that a stamp may be easily and securely attached to
5-24 an export voucher in accordance with Section 151.1575
5-25 [documentation].
5-26 (e) The comptroller may provide stamps only to an official
5-27 verification location [a customs broker licensed under Section
6-1 151.157].
6-2 (f) A stamp is invalid if transferred to a person other than
6-3 the official verification location [customs broker] to whom the
6-4 comptroller issued the stamp or[,] to an [authorized] employee of
6-5 that location [customs broker, or to an authorized independent
6-6 contractor].
6-7 SECTION 4. Section 151.159(b), Tax Code, is amended to read
6-8 as follows:
6-9 (b) The comptroller may issue an export identification card
6-10 to a wholesaler or retailer. The card must contain the picture of
6-11 the person to whom the card is issued. The comptroller may issue
6-12 the card only if the wholesaler or retailer shows by clear and
6-13 convincing evidence that the wholesaler or retailer is a citizen
6-14 and resident of a foreign country and that any tangible personal
6-15 property purchased in this state by the wholesaler or retailer is
6-16 for export purposes only and is to be used or consumed outside the
6-17 territorial limits of the United States. A wholesaler or retailer
6-18 issued an export identification card may use the card only to
6-19 facilitate the preparation of documentation and attached export
6-20 vouchers by a customs broker under Section 151.307(b). The
6-21 comptroller may require a wholesaler or retailer applying for an
6-22 export identification card to submit any information in any form
6-23 the comptroller determines is necessary and to pay a fee in an
6-24 amount the comptroller determines is necessary to pay for the cost
6-25 of issuing the card.
6-26 SECTION 5. Section 151.307, Tax Code, is amended by amending
6-27 Subsections (b), (c), and (d), and by adding Subsections (e) and
7-1 (f) to read as follows:
7-2 (b) When an exemption is claimed because tangible personal
7-3 property is exported beyond the territorial limits of the United
7-4 States, proof of export may be shown only by:
7-5 (1) a bill of lading issued by a licensed and
7-6 certificated carrier of persons or property showing the seller as
7-7 consignor, the buyer as consignee, and a delivery point outside the
7-8 territorial limits of the United States;
7-9 (2) documentation and attached export vouchers:
7-10 (A) provided by a United States Customs Broker
7-11 licensed by the comptroller under Section 151.157;
7-12 (B) certifying that delivery was made to a point
7-13 outside the territorial limits of the United States; and
7-14 (C) to which a stamp issued under Section
7-15 151.158 is affixed in the manner required by that section or
7-16 Section 151.157;
7-17 (3) import documents from the country of destination
7-18 showing that the property was imported into a country other than
7-19 the United States;
7-20 (4) an original airway, ocean, or railroad bill of
7-21 lading and a forwarder's receipt if an air, ocean, or rail freight
7-22 forwarder takes possession of the property; or
7-23 (5) any other manner provided by the comptroller for
7-24 an enterprise authorized to make tax-free purchases under Section
7-25 151.156.
7-26 (c) Documentation, including an export voucher with the
7-27 stamp affixed [to the documentation], that is provided by a customs
8-1 broker licensed by the comptroller under Section 151.157 is
8-2 presumed valid in the absence of clear and convincing evidence that
8-3 the tangible personal property covered by the documentation was not
8-4 exported outside the territorial limits of the United States.
8-5 (d) A retailer who receives documentation under Subsection
8-6 (b)(2) relating to the purchase of tangible personal property
8-7 exported beyond the limits of the United States may not refund the
8-8 tax paid under this chapter on that purchase before:
8-9 (1) the 24th hour after the hour stated as the time of
8-10 export on the documentation, if the retailer is located in a county
8-11 that borders the United Mexican States; or
8-12 (2) the seventh day after the day stated as the date
8-13 of export on the documentation, if the retailer is located in a
8-14 county that does not border the United Mexican States.
8-15 (e) A retailer who makes a refund before the time prescribed
8-16 by Subsection (d) or makes a refund that is undocumented or
8-17 improperly documented is liable for the amount of the tax refunded
8-18 with interest.
8-19 (f) In this section:
8-20 (1) "Air forwarder" means a licensed International Air
8-21 Transportation Association freight forwarder.
8-22 (2) "Ocean forwarder" means a licensed Federal
8-23 Maritime Commission freight forwarder.
8-24 SECTION 6. Sections 151.712(a), (b), (f), (g), and (i), Tax
8-25 Code, are amended to read as follows:
8-26 (a) A person may not sign or certify proof of export
8-27 documentation for the purpose of showing an exemption under Section
9-1 151.307(b)(2) unless:
9-2 (1) the person is:
9-3 (A) a customs broker licensed by the comptroller
9-4 under Section 151.157; or
9-5 (B) an authorized employee of a customs broker
9-6 licensed by the comptroller under Section 151.157; and
9-7 (2) the tangible personal property the export of which
9-8 the person certifies is exported on the date and to the place shown
9-9 on the export voucher attached to the export documentation signed
9-10 by the person.
9-11 (b) A person who provides proof of documentation that
9-12 tangible personal property has been exported outside of the United
9-13 States or a person who may benefit from the provision of the proof
9-14 of documentation, including a customs broker, authorized employee,
9-15 official verification location or employee of the location
9-16 [authorized independent contractor], seller of the property or
9-17 agent or employee of the seller, or a consumer of the property or
9-18 agent or employee of the consumer, may not sell or buy the proof of
9-19 documentation, including an export voucher or stamps required for
9-20 the documentation. This subsection does not apply to:
9-21 (1) a customs broker who accepts a fee for providing
9-22 documentation under Section 151.307(b); or
9-23 (2) an official verification location who accepts
9-24 payment under a contract with a customs broker under Section
9-25 151.1575.
9-26 (f) In addition to any monetary penalty under this section,
9-27 the comptroller shall require the person to pay to the state any
10-1 tax revenue lost to this state due to the person's actions with
10-2 interest and may:
10-3 (1) suspend or revoke under Section 151.157 the
10-4 license of a customs broker who violates this section; or
10-5 (2) suspend or revoke the designation of an official
10-6 verification location under Section 151.1575.
10-7 (g) A proceeding to impose a civil penalty or suspend or
10-8 revoke a license or designation because of a violation of this
10-9 section is a contested case under Chapter 2001, Government Code.
10-10 Judicial review is by trial de novo. The district courts of Travis
10-11 County have exclusive original jurisdiction of a suit under this
10-12 section.
10-13 (i) In this section:
10-14 (1) "Authorized [, "customs broker" and "authorized]
10-15 employee" has [have] the meaning [meanings] assigned by Section
10-16 151.157.
10-17 (2) "Customs broker" has the meaning assigned by
10-18 Section 151.157.
10-19 (3) "Official verification location" means a person
10-20 designated by the comptroller under Section 151.1575 to verify the
10-21 export of tangible personal property outside this state.
10-22 SECTION 7. Sections 151.713(a), (g), and (h), Tax Code, are
10-23 amended to read as follows:
10-24 (a) A person may not obtain or attempt to obtain export
10-25 documentation or an export voucher for the purpose of showing an
10-26 exemption under Section 151.307(b)(2) from a customs broker, [or]
10-27 an authorized employee of a customs broker, or an official
11-1 verification location if the person knows, at the time the
11-2 documentation or voucher is sought, that the information provided
11-3 to the broker, [or] employee, or official verification location is
11-4 materially false, in whole or in part, and the documentation or
11-5 export voucher is sought for the purpose of evading the tax imposed
11-6 by this chapter.
11-7 (g) In addition to any monetary penalty under this section,
11-8 the comptroller shall require the person to pay to the state any
11-9 tax revenue lost to this state due to the person's actions. The
11-10 penalty imposed by this section is in addition to any other tax,
11-11 penalty, and interest that may be assessed against a person who
11-12 violates this section.
11-13 (h) In this section:
11-14 (1) "Authorized [, "customs broker" and "authorized]
11-15 employee" has [have] the meaning [meanings] assigned by Section
11-16 151.157.
11-17 (2) "Customs broker" has the meaning assigned by
11-18 Section 151.157.
11-19 (3) "Official verification location" means a person
11-20 designated by the comptroller under Section 151.1575 to verify the
11-21 export of tangible personal property outside this state.
11-22 SECTION 8. This Act takes effect September 1, 1999, and
11-23 applies to an exemption to the sales and use tax imposed under
11-24 Chapter 151, Tax Code, claimed on or after January 1, 2000. An
11-25 exemption to the sales and use tax imposed under Chapter 151, Tax
11-26 Code, claimed before January 1, 2000, is governed by the law in
11-27 effect when the exemption was claimed, and that law is continued in
12-1 effect for that purpose.
12-2 SECTION 9. The importance of this legislation and the
12-3 crowded condition of the calendars in both houses create an
12-4 emergency and an imperative public necessity that the
12-5 constitutional rule requiring bills to be read on three several
12-6 days in each house be suspended, and this rule is hereby suspended.