By Isett                                              H.B. No. 2832
         76R7309 DAK-D                           
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to tax auditing and collection procedures.
 1-4           SECTION 1.  Subchapter A, Chapter 111, Tax Code, is amended
 1-5     by adding Sections 111.0037 and 111.0038 to read as follows:
 1-6           Sec. 111.0037.  SELF-AUDITING UNDER SUPERVISION OF
 1-7     COMPTROLLER.  (a)  A taxpayer may apply to the comptroller for
 1-8     permission to conduct its own tax audit under the supervision of
 1-9     the comptroller.
1-10           (b)  The comptroller shall allow the taxpayer to conduct its
1-11     own tax audit if the comptroller determines that:
1-12                 (1)  the auditing procedures used by the taxpayer to
1-13     conduct its own tax audit are accurate and verifiable;
1-14                 (2)  the nature of the taxpayer's business makes a
1-15     self-audit reasonable; and
1-16                 (3)  allowing the taxpayer to conduct its own audit is
1-17     likely to be time-efficient.
1-18           (c)  The comptroller may supervise, verify, or audit the
1-19     audit process of the taxpayer in any manner the comptroller
1-20     considers necessary.
1-21           (d)  Notwithstanding Sections 111.060 and 111.061, any
1-22     interest or penalty is waived on any delinquent tax found by a
1-23     self-audit under this section.
1-24           (e)  The taxpayer is entitled to a refund of any tax
 2-1     overpayment found by a self-audit under this section.
 2-2           Sec. 111.0038.  PERCENTAGE-BASED REPORTING.  The comptroller
 2-3     may implement a system of percentage-based reporting that allows a
 2-4     taxpayer the nature of whose business the comptroller determines is
 2-5     suitable for the system to report its future tax responsibilities
 2-6     based on a historical percentage calculated from a sample of
 2-7     transactions.
 2-8           SECTION 2.  Section 111.104, Tax Code, is amended by amending
 2-9     Subsection (f) and adding Subsections (g) and (h) to read as
2-10     follows:
2-11           (f)  Except as provided by Subsection (g), no [No] taxes,
2-12     penalties, or interest may be refunded to a person who has
2-13     collected the taxes from another person unless the person has
2-14     refunded all the taxes and interest to the person from whom the
2-15     taxes were collected.
2-16           (g)  A person who holds a sales tax permit under Chapter 151
2-17     and who makes a claim under this section for a refund of sales
2-18     taxes paid by the person in error may take a credit on the person's
2-19     sales tax return for the amount claimed to have been paid in error.
2-20     If the claim is finally denied in whole or in part, the person is
2-21     liable for the tax due and any applicable interest and penalty.
2-22           (h)  In finding whether an amount of tax has been unlawfully
2-23     or erroneously collected under Subsection (a), the comptroller
2-24     shall use, on its own initiative or at the request of the taxpayer,
2-25     the same or similar audit sampling techniques used by the
2-26     comptroller to determine if there is any tax deficiency.
2-27           SECTION 3.  (a)  This Act takes effect September 1, 1999.
 3-1           (b)  Section 2 of this Act applies to a claim for a refund of
 3-2     tax made on or after the effective date of this Act, without regard
 3-3     to whether the tax is claimed to have been erroneously paid before,
 3-4     on, or after that date.
 3-5           SECTION 4.  The importance of this legislation and the
 3-6     crowded condition of the calendars in both houses create an
 3-7     emergency and an imperative public necessity that the
 3-8     constitutional rule requiring bills to be read on three several
 3-9     days in each house be suspended, and this rule is hereby suspended.