By: Armbrister S.B. No. 1488
Line and page numbers may not match official copy.
Bill not drafted by TLC or Senate E&E.
A BILL TO BE ENTITLED
AN ACT
1-1 relating to technical changes to statutes involving taxes or fees
1-2 administered by the Comptroller of Public Accounts.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Article 102.075(g), Code of Criminal Procedure,
1-5 is amended to read as follows:
1-6 (g) A municipality or county may retain 10 percent of the
1-7 money collected under this article as a service fee for collection
1-8 if the municipality or county remits the funds to the comptroller
1-9 within the period prescribed in Subsection (f). The municipality
1-10 or county may retain any interest accrued on the money if the
1-11 custodian of the money deposited in the treasury keeps records of
1-12 the amount of money collected under this article that is on deposit
1-13 in the treasury and remits the funds to the comptroller within the
1-14 period prescribed in Subsection (f).
1-15 SECTION 2. Section 12(b), Article 1.14-1, Insurance Code, is
1-16 amended to read as follows:
1-17 (b) The report shall be filed and any tax due shall be paid
1-18 by the insured or by any other person designated by the insured.
1-19 The report and tax are due on or before May 15 [March 1] of the
1-20 calendar year after the calendar year in which the insurance was
1-21 procured, continued, or renewed or on another date prescribed by
1-22 the comptroller.
2-1 SECTION 3. Sections 12(a) and (b), Article 1.14-2, Insurance
2-2 Code, are amended to read as follows:
2-3 (a) The premiums charged for surplus lines insurance are
2-4 subject to a premium receipts tax of 4.85 percent of gross premiums
2-5 charged for such insurance. The term premium includes all
2-6 premiums, membership fees, assessments, dues or any other
2-7 consideration for insurance. Such tax shall be in lieu of all
2-8 other insurance taxes. The surplus lines agent shall collect from
2-9 the insured the amount of the tax at the time of delivery of the
2-10 cover note, certificate of insurance, policy or other initial
2-11 confirmation of insurance, in addition to the full amount of the
2-12 gross premium charged by the insurer for the insurance. No agent
2-13 shall absorb such tax nor shall any agent, as an inducement for
2-14 insurance or for any other reason, rebate all or any part of such
2-15 tax or his commission. The surplus lines agent shall file a report
2-16 and pay taxes to the comptroller on or before March 1 of each year
2-17 on forms prescribed by the comptroller. The [the] amount of taxes
2-18 shall be based on gross premiums written or received for such
2-19 insurance placed through an eligible surplus lines insurer during
2-20 the calendar year ending on the preceding December 31. A tax
2-21 prepayment shall be required any time accrued taxes due equal or
2-22 exceed $70,000. The prepayment of the accrued taxes, together with
2-23 a form prescribed by the comptroller, shall be due by the 15th day
2-24 of the month following the month in which accrued taxes total
2-25 $70,000 [and shall pay to the comptroller the tax as provided for
2-26 by this Article]. If a surplus lines policy covers risks or
3-1 exposures only partially in this state, the tax payable shall be
3-2 computed on the portions of the premium which are properly
3-3 allocated to the risks or exposures located in this state. In
3-4 determining the amount of premiums taxable in this state, all
3-5 premiums written, procured, or received in this state and all
3-6 premiums on policies negotiated in this state shall be deemed
3-7 written on property or risks located or resident in this state,
3-8 except such premiums as are properly allocated or apportioned and
3-9 reported as premiums which may be subject to taxation by any other
3-10 state or states. Premiums that are properly allocated to any other
3-11 state or states that are specifically exempt from taxation under
3-12 the regulations of that state or states are not taxable in this
3-13 state. Premiums on risks or exposures which are properly allocated
3-14 to federal waters, international waters or under the jurisdiction
3-15 of a foreign government shall not be taxable by this state. In
3-16 event of cancellation and rewriting of any surplus lines insurance
3-17 contract the additional premium for premium receipts tax purposes
3-18 shall be the premium in excess of the unearned premium of the
3-19 canceled insurance contract.
3-20 (b) All surplus lines premium receipt taxes collected by a
3-21 surplus lines agent are trust funds in his hands [and property of
3-22 the state. Such funds shall be maintained by the surplus lines
3-23 agent in a separate account and shall not be mingled with any other
3-24 funds, either business or private]. Any surplus lines agent who
3-25 fails or refuses to pay over to the state the surplus lines premium
3-26 receipts tax at the time required by [in] this section, or who
4-1 fraudulently withholds or appropriates or otherwise uses such money
4-2 or any portions thereof belonging to the state is guilty of theft
4-3 and shall be punished as provided by law for the crime of theft,
4-4 irrespective of whether such surplus lines agent has or claims to
4-5 have any interest in such money so received by him.
4-6 SECTION 4. Section 9(b), Texas State College and University
4-7 Employees Uniform Insurance Benefits Act (Article 3.50-3, Vernon's
4-8 Texas Insurance Code), is amended to read as follows:
4-9 (b) Premiums on policies, insurance contracts, or agreements
4-10 with health maintenance organizations established under this Act
4-11 are not subject to any state tax, regulatory fee, or surcharge,
4-12 including premium or maintenance taxes or fees.
4-13 SECTION 5. Section 11(b), Texas Public School Employees
4-14 Group Insurance Act (Article 3.50-4, Vernon's Texas Insurance
4-15 Code), is amended to read as follows:
4-16 (b) A premium or contribution on a policy, insurance
4-17 contract, or agreement authorized as provided by this article is
4-18 not subject to any state tax, regulatory fee, or surcharge,
4-19 including premium or maintenance taxes or fees.
4-20 SECTION 6. Section 326.029(a), Local Government Code, is
4-21 amended to read as follows:
4-22 (a) If a majority of the votes received in the election
4-23 favor the creation of the district and the adoption of the sales
4-24 and use tax, the commissioners court shall by resolution or
4-25 ordinance declare that the district is created and shall declare
4-26 the amount of the local sales and use tax adopted and enter the
5-1 result in its minutes.
5-2 SECTION 7. Section 326.092(a), Local Government Code, is
5-3 amended to read as follows:
5-4 (a) Chapter 323, Tax Code, to the extent not inconsistent
5-5 with this chapter, governs the imposition, computation,
5-6 administration, and governance of the tax under this subchapter,
5-7 except that Section 323.101, 323.105, [and] 323.404, and 323.406
5-8 through 323.408, Tax Code, do not apply.
5-9 SECTION 8. Section 101.003, Tax Code, is amended by adding
5-10 Subdivision (13) to read as follows:
5-11 (13) "Tax" means a tax, fee, assessment, charge, or other
5-12 amount that the comptroller is authorized to administer.
5-13 SECTION 9. Section 111.0041(b), Tax Code, is amended to read
5-14 as follows:
5-15 (b) This section prevails over any other conflicting
5-16 provision of this title [except Section 191.024(b) of this code].
5-17 SECTION 10. Section 111.104(e), Tax Code, is amended to read
5-18 as follows:
5-19 (e) This section applies to all taxes and license fees
5-20 collected or administered by the comptroller, except the state
5-21 property tax [and those taxes that qualify for refund allowed under
5-22 Section 151.318(g) or (n)].
5-23 SECTION 11. Section 111.107, Tax Code, is amended to read as
5-24 follows:
5-25 Sec. 111.107. When Refund or Credit is Permitted. Except as
5-26 otherwise expressly provided, a person may request a refund or a
6-1 credit or the comptroller may make a refund or issue a credit for
6-2 the overpayment of a tax imposed by this title at any time before
6-3 the expiration of the period during which the comptroller may
6-4 assess a deficiency for the tax and not thereafter unless the
6-5 refund or credit is requested:
6-6 (1) under Subchapter B of Chapter 112 and the refund is made
6-7 or the credit is issued under a court order;
6-8 (2) under the provision of Section 111.104(c)(3) applicable
6-9 to a refund claim filed after a jeopardy or deficiency
6-10 determination becomes final; or
6-11 (3) under Chapter 153, except Section 153.1195(e),
6-12 153.121(d), 153.2225(e), or 153.224(d)[; or]
6-13 [(4) under Section 151.318(g) or (n)].
6-14 SECTION 12. Sections 151.310(c) and (e), Tax Code, are
6-15 amended to read as follows:
6-16 (c) An organization that qualifies for an exemption under
6-17 Subsection (a)(1) or (a)(2) of this section, and each bona fide
6-18 chapter of the organization, may hold two tax-free sales or
6-19 auctions under this subsection during a calendar year and each
6-20 tax-free sale or auction may continue for one day only. The sale
6-21 of a taxable item the sales price of which is $5,000 or less by a
6-22 qualified organization or chapter of the organization at a tax-free
6-23 sale or auction is exempted from the sales tax imposed by
6-24 Subchapter C of this chapter, except that a taxable item
6-25 manufactured by or donated to the qualified organization or chapter
6-26 of the organization may be sold tax free regardless of the sales
7-1 price to any purchaser other than the donor. The storage, use, or
7-2 consumption of a taxable item that is acquired from a qualified
7-3 organization or chapter of the organization at a tax-free sale or
7-4 auction and that is exempted under this subsection from the taxes
7-5 imposed by Subchapter C of this chapter is exempted from the use
7-6 tax imposed by Subchapter D of this chapter until the item is
7-7 resold or subsequently transferred.
7-8 (e) A nonprofit hospital or hospital system that qualifies
7-9 for an exemption under Subsection (a)(2) shall provide community
7-10 benefits that include charity care and government-sponsored
7-11 indigent health care [community benefits] as set forth in
7-12 Subchapter D, Chapter 311, Health and Safety Code. [Subdivision
7-13 (1), (2), (3), (4), (5), (6), (7), or (8) below:]
7-14 [(1) charity care and government-sponsored indigent
7-15 health care are provided at a level which is reasonable in relation
7-16 to the community needs, as determined through the community needs
7-17 assessment, the available resources of the hospital or hospital
7-18 system, and the tax-exempt benefits received by the hospital or
7-19 hospital system;]
7-20 [(2) charity care and government-sponsored indigent
7-21 health care are provided in an amount equal to at least four
7-22 percent of the hospital's or hospital system's net patient revenue;]
7-23 [(3) charity care and government-sponsored indigent
7-24 health care are provided in an amount equal to at least 100 percent
7-25 of the hospital's or hospital system's tax-exempt benefits,
7-26 excluding federal income tax;]
8-1 [(4) for tax periods beginning before January 1, 1996,
8-2 charity care and community benefits are provided in a combined
8-3 amount equal to at least five percent of the hospital's or hospital
8-4 system's net patient revenue, provided that charity care and
8-5 government-sponsored indigent health care are provided in an amount
8-6 equal to at least three percent of net patient revenue;]
8-7 [(5) for tax periods beginning after December 31,
8-8 1995, charity care and community benefits are provided in a
8-9 combined amount equal to at least five percent of the hospital's or
8-10 hospital system's net patient revenue, provided that charity care
8-11 and government-sponsored indigent health care are provided in an
8-12 amount equal to at least four percent of net patient revenue;]
8-13 [(6) a nonprofit hospital that has been designated as
8-14 a disproportionate share hospital under the state Medicaid program
8-15 in the current year or in either of the previous two fiscal years
8-16 is considered to have provided a reasonable amount of charity care
8-17 and government-sponsored indigent health care and is considered in
8-18 compliance with the standards provided by this subsection;]
8-19 [(7) a hospital operated on a nonprofit basis that is
8-20 located in a county with a population of less than 50,000 and in
8-21 which the entire county or the population of the entire county has
8-22 been designated as a health professionals shortage area is
8-23 considered to be in compliance with the standards provided by this
8-24 subsection; or]
8-25 [(8) a hospital providing health care services to
8-26 inpatients or outpatients without receiving any payment for
9-1 providing those services from any source, including the patient or
9-2 person legally obligated to support the patient, third-party
9-3 payors, Medicare, Medicaid, or any other state or local indigent
9-4 care program but excluding charitable donations, legacies,
9-5 bequests, or grants or payments for research, is considered to be
9-6 in compliance with the standards provided by this subsection.]
9-7 [For purposes of satisfying Subdivision (5), a hospital or
9-8 hospital system may not change its existing fiscal year unless the
9-9 hospital or hospital system changes its ownership or corporate
9-10 structure as a result of a sale or merger.]
9-11 [For purposes of this subsection, a hospital that satisfies
9-12 Subdivision (1), (6), (7), or (8) shall be excluded in determining
9-13 a hospital system's compliance with the standards provided by
9-14 Subdivision (2), (3), (4), or (5).]
9-15 [For purposes of this subsection, the terms "charity care,"
9-16 "government-sponsored indigent health care," "health care
9-17 organization," "hospital system," "net patient revenue," "nonprofit
9-18 hospital," and "tax-exempt benefits" have the meanings set forth in
9-19 Sections 311.031 and 311.042, Health and Safety Code. A
9-20 determination of the amount of community benefits and charity care
9-21 and government-sponsored indigent health care provided by a
9-22 hospital or hospital system and the hospital's or hospital system's
9-23 compliance with the requirements of this subsection and Section
9-24 311.045, Health and Safety Code, shall be based on the most
9-25 recently completed and audited prior fiscal year of the hospital or
9-26 hospital system.]
10-1 [The providing of charity care and government-sponsored
10-2 indigent health care in accordance with Subdivision (1) shall be
10-3 guided by the prudent business judgment of the hospital which will
10-4 ultimately determine the appropriate level of charity care and
10-5 government-sponsored indigent health care based on the community
10-6 needs, the available resources of the hospital, the tax-exempt
10-7 benefits received by the hospital, and other factors that may be
10-8 unique to the hospital, such as the hospital's volume of Medicare
10-9 and Medicaid patients. These criteria shall not be determinative
10-10 factors, but shall be guidelines contributing to the hospital's
10-11 decision along with other factors which may be unique to the
10-12 hospital. The formulas contained in Subdivisions (2), (3), (4),
10-13 and (5) shall also not be considered determinative of a reasonable
10-14 amount of charity care and government-sponsored indigent health
10-15 care.]
10-16 [The requirements of this subsection shall not apply to the
10-17 extent a hospital or hospital system demonstrates that reductions
10-18 in the amount of community benefits, charity care, and
10-19 government-sponsored indigent health care are necessary to maintain
10-20 financial reserves at a level required by a bond covenant, are
10-21 necessary to prevent the hospital or hospital system from
10-22 endangering its ability to continue operations, or if the hospital
10-23 or hospital system, as a result of a natural or other disaster, is
10-24 required substantially to curtail its operations.]
10-25 [In any fiscal year that a hospital or hospital system,
10-26 through unintended miscalculation, fails to meet any of the
11-1 standards in this subsection, the hospital or hospital system shall
11-2 not lose its tax-exempt status without the opportunity to cure the
11-3 miscalculation in the fiscal year following the fiscal year the
11-4 failure is discovered by both meeting one of the standards and
11-5 providing an additional amount of charity care and
11-6 government-sponsored indigent health care that is equal to the
11-7 shortfall from the previous fiscal year. A hospital or hospital
11-8 system may apply this provision only once every five years.]
11-9 SECTION 13. Section 151.312, Tax Code, is amended to read as
11-10 follows:
11-11 Sec. 151.312. Periodicals and Writings of Religious,
11-12 Philanthropic, Charitable, Historical, Scientific, and Similar
11-13 Organizations. Periodicals and writings, including those presented
11-14 on audio tape, video tape, and computer disk, that are published
11-15 and [or] distributed by a religious, philanthropic, charitable,
11-16 historical, scientific, or other similar organization that is not
11-17 operated for profit, but excluding an educational organization, are
11-18 exempted from the taxes imposed by this chapter.
11-19 SECTION 14. Sections 151.318(a), (c), (g), (o), (q), and
11-20 (s), Tax Code, are amended to read as follows:
11-21 (a) The following items are exempted from the taxes imposed
11-22 by this chapter if sold, leased, or rented to, or stored, used, or
11-23 consumed by a manufacturer:
11-24 (1) tangible personal property that will become an
11-25 ingredient or component part of tangible personal property
11-26 manufactured, processed, or fabricated for ultimate sale;
12-1 (2) tangible personal property directly used or
12-2 consumed in or during the actual manufacturing, processing, or
12-3 fabrication of tangible personal property for ultimate sale if the
12-4 use or consumption of the property is necessary or essential to the
12-5 manufacturing, processing, or fabrication operation and directly
12-6 makes or causes a chemical or physical change to:
12-7 (A) the product being manufactured, processed,
12-8 or fabricated for ultimate sale; or
12-9 (B) any intermediate or preliminary product that
12-10 will become an ingredient or component part of the product being
12-11 manufactured, processed, or fabricated for ultimate sale;
12-12 (3) services performed directly on the product being
12-13 manufactured prior to its distribution for sale and for the purpose
12-14 of making the product more marketable;
12-15 (4) actuators, steam production equipment and its
12-16 fuel, in-process flow through tanks, cooling towers, generators,
12-17 heat exchangers, electronic control room equipment, computerized
12-18 control units, pumps, compressors, and hydraulic units, that are
12-19 used to power, supply, support, or control equipment that qualifies
12-20 for exemption under Subdivision (2) or (5) or to generate
12-21 electricity, chilled water, or steam for ultimate sale; and
12-22 transformers located at an electric generating facility that
12-23 increase the voltage of electricity generated for ultimate sale;
12-24 the switches, breakers, capacitor banks, regulators, and relays
12-25 that are related to such transformers; and the electrical cable
12-26 that carries the electricity from the electric generating equipment
13-1 to such transformers;
13-2 (5) [machinery, equipment, and replacement parts or
13-3 accessories] tangible personal property used or consumed in the
13-4 actual manufacturing, processing, or fabrication of tangible
13-5 personal property for ultimate sale if [their] the use or
13-6 consumption of the property is necessary and essential to a
13-7 pollution control process;
13-8 (6) lubricants, chemicals, chemical compounds, gases,
13-9 or liquids that are used or consumed during the actual
13-10 manufacturing, processing, or fabrication of tangible personal
13-11 property for ultimate sale if their use or consumption is necessary
13-12 and essential to prevent the decline, failure, lapse, or
13-13 deterioration of equipment exempted by this section;
13-14 (7) gases used on the premises of a manufacturing
13-15 plant to prevent contamination of raw material or product, or to
13-16 prevent a fire, explosion, or other hazardous or environmentally
13-17 damaging situation at any stage in the manufacturing process or in
13-18 loading or storage of the product or raw material on premises;
13-19 (8) tangible personal property used or consumed during
13-20 the actual manufacturing, processing, or fabrication of tangible
13-21 personal property for ultimate sale if the use or consumption of
13-22 the property is necessary and essential to a quality control
13-23 process;
13-24 (9) safety apparel or work clothing that is used
13-25 during the actual manufacturing, processing, or fabrication of
13-26 tangible personal property for ultimate sale if the use of the
14-1 apparel or clothing is necessary and essential to the manufacturing
14-2 process and the apparel or clothing is not resold to the employee.
14-3 Such apparel or clothing is necessary and essential only if the
14-4 manufacturing process would not be possible without its use;
14-5 (10) tangible personal property used or consumed in
14-6 the actual manufacturing, processing, or fabrication of tangible
14-7 personal property for ultimate sale if the use or consumption of
14-8 the property is necessary and essential to comply with federal,
14-9 state, or local law or rules for public health; and
14-10 (11) tangible personal property specifically installed
14-11 to:
14-12 (A) reduce water use and wastewater flow volumes
14-13 from the manufacturing, processing, fabrication, or repair
14-14 operation;
14-15 (B) reuse and recycle wastewater streams
14-16 generated within the manufacturing, processing, fabrication, or
14-17 repair operation; or
14-18 (C) treat wastewater from another industrial or
14-19 municipal source for the purpose of replacing existing freshwater
14-20 sources in the manufacturing, processing, fabrication, or repair
14-21 operation.
14-22 (c) The exemption does not include:
14-23 (1) intraplant transportation equipment, including
14-24 intraplant transportation equipment used to move a product or raw
14-25 material in connection with the manufacturing process and
14-26 specifically including all piping and conveyor systems, provided
15-1 that the following remain eligible for the exemption:
15-2 (A) piping or conveyor systems that are [is] a
15-3 component part of a single item of manufacturing equipment or
15-4 pollution control equipment eligible for the exemption under
15-5 Subsection (a)(2), (a)(4), or (a)(5);
15-6 (B) piping through which the product or an
15-7 intermediate or preliminary product that will become an ingredient
15-8 or component part of the product is recycled or circulated in a
15-9 loop between the single item of manufacturing equipment and the
15-10 ancillary equipment that supports only that single item of
15-11 manufacturing equipment if the single item of manufacturing
15-12 equipment and the ancillary equipment operate together to perform a
15-13 specific step in the manufacturing process; and
15-14 (C) piping through which the product or an
15-15 intermediate or preliminary product that will become an ingredient
15-16 or component part of the product is recycled back to another single
15-17 item of manufacturing equipment and its ancillary equipment in the
15-18 same manufacturing process. [remains eligible for the exemption]
15-19 Piping through which material is transported forward from one
15-20 single item of manufacturing equipment and its ancillary support
15-21 equipment to another single item of manufacturing equipment and its
15-22 ancillary support equipment is not considered a component part of a
15-23 single item of manufacturing equipment and is not exempt. An
15-24 integrated group of manufacturing and processing machines and
15-25 ancillary equipment that operate together to create or produce the
15-26 product or an intermediate or preliminary product that will become
16-1 an ingredient or component part of the product is not a single item
16-2 of manufacturing equipment;
16-3 (2) [maintenance or janitorial supplies or equipment
16-4 or other machinery, equipment, materials, or supplies that are used
16-5 incidentally in a manufacturing, processing, or fabrication
16-6 operation;]
16-7 [(3)] hand tools;
16-8 [(4)] (3) maintenance supplies not otherwise exempted
16-9 under this section, maintenance equipment, janitorial supplies or
16-10 equipment, office equipment or supplies, or equipment or supplies
16-11 used in sales or distribution activities, research or development
16-12 of new products, or transportation activities[, or other tangible
16-13 personal property not used in an actual manufacturing, processing,
16-14 or fabrication operation;] or
16-15 [(5)] (4) machinery and equipment or supplies used to
16-16 [maintain] preserve or store tangible personal property.
16-17 [(g) Each person engaged in manufacturing, processing,
16-18 fabricating, or repairing tangible personal property for ultimate
16-19 sale is entitled to a refund or a reduction in the amount of tax
16-20 imposed by this chapter as provided by Subsection (h) for the
16-21 purchase of machinery, equipment, and replacement parts or
16-22 accessories with a useful life in excess of six months if the
16-23 equipment is:]
16-24 [(1) used or consumed in or during the actual
16-25 manufacturing, processing, fabrication, or repair of tangible
16-26 personal property for ultimate sale, and the use or consumption of
17-1 the property is necessary or essential to the manufacturing,
17-2 processing, fabrication, or repair operation, or to a pollution
17-3 control process; or]
17-4 [(2) specifically installed to:]
17-5 [(A) reduce water use and wastewater flow
17-6 volumes from the manufacturing, processing, fabrication, or repair
17-7 operation;]
17-8 [(B) reuse and recycle wastewater streams
17-9 generated within the manufacturing, processing, fabrication, or
17-10 repair operation; or]
17-11 [(C) treat wastewater from another industrial or
17-12 municipal source for the purpose of replacing existing freshwater
17-13 sources in the manufacturing, processing, fabrication, or repair
17-14 operation.]
17-15 (o) The production of a publication for the dissemination of
17-16 news of a general character and of a general interest that is
17-17 printed on newsprint and distributed to the general public free of
17-18 charge at a daily, weekly, or other short interval is considered
17-19 "manufacturing" for purposes of [Subsections (d)-(m) of] this
17-20 section.
17-21 (q) For purposes of Subsection (b), "semiconductor
17-22 fabrication cleanrooms and equipment" means all tangible personal
17-23 property, without regard to whether the property is affixed to or
17-24 incorporated into realty, used in connection with the
17-25 manufacturing, processing, or fabrication in a cleanroom
17-26 environment of a semiconductor product, without regard to whether
18-1 the property is actually contained in the cleanroom environment.
18-2 The term includes integrated systems, fixtures, and piping, all
18-3 property necessary or adapted to reduce contamination or to control
18-4 airflow, temperature, humidity, chemical purity, or other
18-5 environmental conditions or manufacturing tolerances, and
18-6 production equipment and machinery. The term does not include the
18-7 building or a permanent, nonremovable component of the building,
18-8 that houses the cleanroom environment. The term includes moveable
18-9 cleanroom partitions and cleanroom lighting. "Semiconductor
18-10 fabrication cleanrooms and equipment" are not "interplant
18-11 transportation equipment" [or "used incidentally in a
18-12 manufacturing, processing, or fabrication operation"] as [those
18-13 terms are] that term is used in [Subsections] Subsection (c)(1)
18-14 [and (c)(2)].
18-15 (s) The following do not apply to the semiconductor
18-16 fabrication cleanrooms and equipment in Subsection (q):
18-17 (1) limitations in Subsection (a)(2) that refer to
18-18 tangible personal property directly causing chemical and physical
18-19 changes to the product being manufactured, processed, or fabricated
18-20 for ultimate sale;
18-21 (2) Subsection (c)(1); and
18-22 (3) Subsection (c)[(5)](4).
18-23 SECTION 15. Section 151.321(a), Tax Code, is amended to read
18-24 as follows:
18-25 (a) A taxable item sold by a qualified student organization
18-26 and for which the sales price is $5,000 or less is exempted from
19-1 the taxes imposed by Subchapter C, except that a taxable item
19-2 manufactured by or donated to the organization is exempt from the
19-3 taxes imposed by subchapter C regardless of sales price unless sold
19-4 to the donor, if the student organization:
19-5 (1) sells the item at a sale that may last for one day
19-6 only and the primary purpose of which is to raise funds for the
19-7 organization; and
19-8 (2) holds not more than one sale described by
19-9 Subdivision (1) each month for which an exemption is claimed for an
19-10 item sold.
19-11 SECTION 16. Section 151.350(d), Tax Code, is amended to read
19-12 as follows:
19-13 (d) In this section, "restore" means:
19-14 (1) launder, [or] clean, repair, treat, or apply
19-15 protective chemicals to an item, to the extent the service is a
19-16 personal service as defined in Section 151.0045; and
19-17 (2) repair, restore, or remodel, to the extent the
19-18 service is:
19-19 (A) a real property repair or remodeling service
19-20 as defined in Section 151.0047; or
19-21 (B) defined as a taxable service in Section
19-22 151.0101(a)(5) [151.0101(5)].
19-23 SECTION 17. Sections 151.429(d) and (g), Tax Code, are
19-24 amended to read as follows:
19-25 (d) To receive a refund under this section, an enterprise
19-26 project must apply to the comptroller for the refund. The Texas
20-1 Department of Economic Development [department of commerce] shall
20-2 provide the comptroller with the assistance that the comptroller
20-3 requires in administering this section.
20-4 (g) The refund provided by this section is conditioned on
20-5 the enterprise project maintaining at least the same level of
20-6 employment of qualified employees as existed at the time it
20-7 qualified for a refund for a period of three years from that date.
20-8 The Texas Department of Economic Development [Commerce] shall
20-9 annually certify to the comptroller and the Legislative Budget
20-10 Board whether that level of employment of qualified employees has
20-11 been maintained. On the Texas Department of Economic Development
20-12 [Commerce] certifying that such a level has not been maintained,
20-13 the comptroller shall assess that portion of the refund
20-14 attributable to any such decrease in employment, including penalty
20-15 and interest from the date of the refund.
20-16 SECTION 18. Section 151.429(e)(1), Tax Code, is amended to
20-17 read as follows:
20-18 (1) "Enterprise project" means a person designated by
20-19 the Texas Department of Economic Development [Commerce] as an
20-20 enterprise project under Chapter 2303, Government Code.
20-21 SECTION 19. Sections 151.4291(d) and (g), Tax Code, are
20-22 amended to read as follows:
20-23 (d) To receive a refund under this section, a defense
20-24 readjustment project must apply to the comptroller for the refund.
20-25 The Texas Department of Economic Development [Commerce] shall
20-26 provide the comptroller with the assistance that the comptroller
21-1 requires in administering this section.
21-2 (g) The refund provided by this section is conditioned on
21-3 the defense readjustment project maintaining at least the same
21-4 level of employment of qualified employees as existed at the time
21-5 it qualified for a refund for a period of three years from that
21-6 date. The Texas Department of Economic Development [Commerce]
21-7 shall annually certify to the comptroller and the Legislative
21-8 Budget Board whether that level of employment of qualified
21-9 employees has been maintained. On the Texas Department of Economic
21-10 Development [Commerce] certifying that such a level has not been
21-11 maintained, the comptroller shall assess that portion of the refund
21-12 attributable to any such decrease in employment, including penalty
21-13 and interest from the date of the refund.
21-14 SECTION 20. Section 151.4291(e)(1), Tax Code, is amended to
21-15 read as follows:
21-16 (1) "Defense readjustment project" means a person
21-17 designated by the Texas Department of Economic Development
21-18 [Commerce] as a defense readjustment project under Chapter 2310,
21-19 Government Code.
21-20 SECTION 21. Section 151.431(a), Tax Code, is amended to read
21-21 as follows:
21-22 (a) A qualified business operating in the enterprise zone's
21-23 jurisdiction for at least three consecutive years may apply for and
21-24 be granted a onetime refund of sales and use tax paid by the
21-25 qualified business after certification of the qualified business as
21-26 provided by Subsection (b) of this section to a vendor or directly
22-1 to the state for the purchase of equipment or machinery sold to the
22-2 business for use in an enterprise zone if the governing body or
22-3 bodies certify to the Texas Department of Economic Development
22-4 [Commerce] that the business is retaining 10 or more jobs held by
22-5 qualified employees during the year. For the purposes of this
22-6 subsection "job" means an existing employment position of a
22-7 qualified business that has provided employment to a qualified
22-8 employee of at least 1,820 hours annually.
22-9 SECTION 22. Section 152.041, Tax Code, is amended by adding
22-10 Subsection (e) to read as follows:
22-11 (e) If a motor vehicle title applicant has paid the tax to
22-12 the seller who is required by this chapter to collect the tax and
22-13 the seller has failed to remit the tax to the county tax
22-14 assessor-collector, the tax assessor-collector may accept
22-15 application for title to the motor vehicle without the payment of
22-16 additional tax by the applicant. Before title to the motor vehicle
22-17 may be issued under these circumstances, the motor vehicle title
22-18 applicant must present satisfactory documentation to the tax
22-19 assessor-collector that the tax was paid. The county tax
22-20 assessor-collector shall notify the comptroller in writing of the
22-21 seller's failure to remit the tax. The notice must:
22-22 (1) be made before the 31st day after the date the
22-23 application for title is accepted;
22-24 (2) contain the name and address of the seller; and
22-25 (3) include any documentation of the payment of the
22-26 tax provided to the county tax assessor-collector by the motor
23-1 vehicle title applicant.
23-2 SECTION 23. Sections 153.117(a), (b), (d), and (h), Tax
23-3 Code, are amended to read as follows:
23-4 (a) A distributor shall keep a record showing the number of
23-5 gallons of:
23-6 (1) all gasoline inventories on hand at the first of
23-7 each month;
23-8 (2) all gasoline refined, compounded, or blended;
23-9 (3) all gasoline purchased or received, showing the
23-10 name of the seller and date of each purchase or receipt;
23-11 (4) all gasoline sold, distributed, or used, showing
23-12 the name of the purchaser and the date of the sale or use; and
23-13 (5) all gasoline lost by fire, theft, or other
23-14 accident.
23-15 (b) A dealer shall keep a record showing the number of
23-16 gallons of:
23-17 (1) gasoline inventories on hand at the first of each
23-18 month;
23-19 (2) all gasoline purchased or received, showing the
23-20 name of the seller and the date of each purchase or receipt;
23-21 (3) all gasoline sold or used, showing the date of the
23-22 sale or use; and
23-23 (4) all gasoline lost by fire, theft, or other
23-24 accident.
23-25 (d) An aviation fuel dealer shall keep a record showing the
23-26 number of gallons of:
24-1 (1) all gasoline inventories on hand at the first of
24-2 each month;
24-3 (2) all gasoline purchased or received, showing the
24-4 name of the seller and date of each purchase or receipt;
24-5 (3) all gasoline sold or used in aircraft or aircraft
24-6 servicing equipment; and
24-7 (4) all gasoline lost by fire, theft, or other
24-8 accident.
24-9 (h) A gasoline jobber shall keep a record showing the number
24-10 of gallons of:
24-11 (1) all gasoline inventories on hand at the first of
24-12 each month;
24-13 (2) all gasoline purchased or received, showing the
24-14 name of the seller and date of each purchase or receipt;
24-15 (3) all gasoline sold, distributed, or used, showing
24-16 the name of the purchaser and the date of the sale or use; and
24-17 (4) all gasoline lost by fire, theft, or other
24-18 accident.
24-19 SECTION 24. Sections 153.119(a) and (e), Tax Code, are
24-20 amended to read as follows:
24-21 (a) A person who exports, sells to the federal government,
24-22 to a public school district in this state, or to a commercial
24-23 transportation company for exclusive use in providing public school
24-24 transportation services to a school district under Section 34.008,
24-25 Education Code, without having added the amount of the tax imposed
24-26 by this chapter to his selling price, loses by fire, theft, or
25-1 other accident, or uses gasoline for the purpose of operating or
25-2 propelling a motorboat, tractor used for agricultural purposes, or
25-3 stationary engine, or for another purpose except in a vehicle
25-4 operated or intended to be operated on the public highways of this
25-5 state, and who has paid the tax imposed on gasoline by this chapter
25-6 either directly or indirectly is, when the person has complied with
25-7 the invoice and filing provisions of this section and the rules of
25-8 the comptroller, entitled to reimbursement of the tax paid by him,
25-9 less a filing fee and any amount allowed distributors[, wholesalers
25-10 or jobbers, dealers, or others] under Section 153.105(e) [(c)] of
25-11 this code. A public school district that has paid the tax imposed
25-12 under this chapter on gasoline used by the district or a commercial
25-13 transportation company that has paid the tax imposed under this
25-14 chapter on gasoline used by the company exclusively to provide
25-15 public school transportation services to a school district under
25-16 Section 34.008, Education Code, is entitled to reimbursement of the
25-17 amount of the tax paid in the same manner and subject to the same
25-18 procedures as other exempted users.
25-19 (e) A person who exports or loses by fire, theft, or other
25-20 accident 100 or more gallons of gasoline on which the tax has been
25-21 paid, or sells gasoline in any quantity to the United States
25-22 government for the exclusive use of that government on which the
25-23 tax has been paid, may file a claim for a refund of the net tax
25-24 paid to the state in the manner provided by this chapter or as the
25-25 comptroller may direct.
25-26 SECTION 25. Section 153.121(a), Tax Code, is amended to read
26-1 as follows:
26-2 (a) Except as provided by this section, a claim for a refund
26-3 must be filed with the comptroller within one year after the first
26-4 day of the calendar month following the purchase, use, delivery,
26-5 export, or loss by fire, theft, or other accident of gasoline,
26-6 whichever period expires latest.
26-7 SECTION 26. Section 153.206, Tax Code, is amended by adding
26-8 Subsection (j) to read as follows:
26-9 (j) In each subsequent sale of diesel fuel on which the tax
26-10 has been collected, the amount of the tax shall be added to the
26-11 selling price so that the tax is paid ultimately by the person
26-12 using or consuming the diesel fuel for the purpose of propelling a
26-13 vehicle on the public highways of this state.
26-14 SECTION 27. Sections 153.219(a), (b), (c), (d), and (i), Tax
26-15 Code, are amended to read as follows:
26-16 (a) A supplier shall keep a record showing the number of
26-17 gallons of:
26-18 (1) all diesel fuel inventories on hand at the first
26-19 of each month;
26-20 (2) all diesel fuel refined, compounded, or blended;
26-21 (3) all diesel fuel purchased or received, showing the
26-22 name of the seller, and the date of each purchase or receipt;
26-23 (4) all diesel fuel sold, distributed, or used showing
26-24 the name of the purchaser and the date of sale, distribution, or
26-25 use; and
26-26 (5) all diesel fuel lost by fire, theft, or other
27-1 accident.
27-2 (b) A dealer shall keep a record showing the number of
27-3 gallons of:
27-4 (1) all diesel fuel inventories on hand at the first
27-5 of each month;
27-6 (2) all diesel fuel purchased or received, showing the
27-7 name of the seller, the date of each purchase or receipt;
27-8 (3) all diesel fuel sold, distributed, or used; and
27-9 (4) all diesel fuel lost by fire, theft, or other
27-10 accident.
27-11 (c) A bonded user or other user with nonhighway equipment
27-12 uses who files a claim for a refund shall keep a record showing the
27-13 number of gallons of:
27-14 (1) inventories of all diesel fuel on hand at the
27-15 first of each month;
27-16 (2) all diesel fuel purchased or received, showing the
27-17 name of the seller and the date of each purchase;
27-18 (3) all diesel fuel deliveries into the fuel supply
27-19 tanks of motor vehicles;
27-20 (4) diesel fuel used for other purposes, showing the
27-21 purpose for which used; and
27-22 (5) all diesel fuel lost by fire, theft, or other
27-23 accident.
27-24 (d) An aviation fuel dealer shall keep a record showing the
27-25 number of gallons of:
27-26 (1) all diesel fuel inventories on hand at the first
28-1 of each month;
28-2 (2) all diesel fuel purchased or received, showing the
28-3 name of the seller and the date of each purchase or receipt;
28-4 (3) all diesel fuel sold, distributed, or used in
28-5 aircraft or aircraft servicing equipment; and
28-6 (4) diesel fuel lost by fire, theft, or other
28-7 accident.
28-8 (i) A diesel fuel jobber shall keep a record showing the
28-9 number of gallons of:
28-10 (1) all diesel fuel inventories on hand at the first
28-11 of each month;
28-12 (2) all diesel fuel purchased or received, showing the
28-13 name of the seller and date of each purchase or receipt;
28-14 (3) all diesel fuel sold, distributed, or used,
28-15 showing the name of the purchaser and the date of the sale or use;
28-16 and
28-17 (4) all diesel fuel lost by fire, theft, or other
28-18 accident.
28-19 SECTION 28. Section 153.222(e), Tax Code, is amended to read
28-20 as follows:
28-21 (e) A person who exports or loses by fire, theft, or other
28-22 accident 100 or more gallons of diesel fuel on which the tax has
28-23 been paid, or who sells diesel fuel in any quantity to the United
28-24 States for its exclusive use on which the tax has been paid, may
28-25 file a claim for a refund of the net tax paid to the state as the
28-26 comptroller may direct.
29-1 SECTION 29. Section 153.224(a), Tax Code, is amended to read
29-2 as follows:
29-3 (a) Except as provided by this section, a claim for a refund
29-4 must be filed with the comptroller within one year after the first
29-5 day of the calendar month following the purchase, use, delivery,
29-6 export, or loss by fire, theft, or other accident of diesel fuel,
29-7 whichever period expires latest.
29-8 SECTION 30. Sections 154.114(c) and (g), Tax Code, are
29-9 amended to read as follows:
29-10 (c) The comptroller shall deliver [mail] the written notice
29-11 by personal service or by [certified] mail[, return receipt
29-12 requested,] to the permit holder's mailing address as it appears on
29-13 the comptroller's records. Service by mail is complete when the
29-14 notice is deposited with [received, as evidenced by return receipt
29-15 from] the U. S. Postal Service.
29-16 (g) If the comptroller suspends or revokes a permit, the
29-17 comptroller shall provide written notice of the suspension or
29-18 revocation, within a reasonable time, to each distributor and
29-19 wholesaler permit holder in the state. A distributor or wholesaler
29-20 permit holder violates Section 154.1015(a) by selling or
29-21 distributing cigarettes to a person whose permit has been suspended
29-22 or revoked only after the distributor or wholesaler permit holder
29-23 receives written notice of the suspension or revocation from the
29-24 comptroller.
29-25 SECTION 31. Section 154.210(a), Tax Code, is amended to read
29-26 as follows:
30-1 (a) a distributor shall deliver to the comptroller, on or
30-2 before the last [15th] day of each month, a report for the
30-3 preceding month.
30-4 SECTION 32. Section 154.308(b), Tax Code, is amended to read
30-5 as follows:
30-6 (b) On making a deficiency determination, the comptroller
30-7 shall notify the person by [certified] mail or personal service [,
30-8 return receipt requested]. Service by mail is complete when the
30-9 notice is deposited with [received, as evidenced by return receipt
30-10 from] the U.S. Postal Service.
30-11 SECTION 33. Sections 154.309(b) and (d), Tax Code, are
30-12 amended to read as follows:
30-13 (b) A written request for redetermination must be filed at
30-14 the office of the comptroller not later than the 30th [15th
30-15 working] day after the date notice of deficiency is issued
30-16 [received]. If a written request for redetermination is not filed
30-17 as required by this subsection, the determination is final.
30-18 (d) The comptroller shall give notice of a redetermination
30-19 hearing by personal service or by [certified] mail[, return receipt
30-20 requested]. Service by mail is complete when the notice is
30-21 deposited with [received, as evidence by return receipt from] the
30-22 U.S. Postal Service.
30-23 SECTION 34. Section 155.059(c), Tax Code, is amended to read
30-24 as follows:
30-25 (c) The comptroller shall deliver [mail] the written notice
30-26 by personal service or by [certified] mail[, return receipt
31-1 requested,] to the permit holder's mailing address as it appears in
31-2 the comptroller's records. Service by mail is complete when the
31-3 notice is deposited with [received, as evidenced by the return
31-4 receipt from] the United States Postal Service.
31-5 SECTION 35. Section 155.103(b), Tax Code, is amended to read
31-6 as follows:
31-7 (b) A manufacturer who sells tobacco products to a permit
31-8 holder in this state shall file with the comptroller, on or before
31-9 the last [15th] day of each month, a report showing the information
31-10 listed in Subsection (a) for the previous month.
31-11 SECTION 36. Section 155.111(a), Tax Code, is amended to read
31-12 as follows:
31-13 (a) A distributor shall file with the comptroller on or
31-14 before the last [30th] day of each month, a report for the
31-15 preceding month.
31-16 SECTION 37. Section 155.185(b), Tax Code, is amended to read
31-17 as follows:
31-18 (b) On making a deficiency determination, the comptroller
31-19 shall notify the person by personal service or by [certified]
31-20 mail[, return receipt requested]. Service by mail is complete when
31-21 the notice is deposited with [received, as evidenced by return
31-22 receipt from] the U.S. Postal Service.
31-23 SECTION 38. Sections 155.186(b) and (d), Tax Code, are
31-24 amended to read as follows:
31-25 (b) A written request for redetermination must be filed at
31-26 the office of the comptroller not later than the 30th [15th
32-1 working] day after the date notice of deficiency is issued
32-2 [received]. If a written request for redetermination is not filed
32-3 as required by this subsection, the determination is final.
32-4 (d) The comptroller shall give notice of a redetermination
32-5 hearing by personal service or by [certified] mail[, return receipt
32-6 requested]. Service by mail is complete when the notice is
32-7 deposited with [received, as evidenced by return receipt from] the
32-8 U.S. Postal Service.
32-9 SECTION 39. Section 156.102, Tax Code, is amended to read as
32-10 follows:
32-11 Sec. 156.102. Exception--Religious, Charitable, or
32-12 Educational Organization. This chapter does not impose a tax on a
32-13 corporation or association that:
32-14 (1) is organized and operated exclusively for a religious,
32-15 charitable, or educational purpose if no part of the net earnings
32-16 of the corporation or association inure to the benefit of a private
32-17 shareholder or individual; or
32-18 (2) qualifies for exemption from federal income taxes under
32-19 Section 501(c)(3), Internal Revenue Code of 1986.
32-20 SECTION 40. Sections 156.103(a), (b), (c), and (d), Tax
32-21 Code, are amended to read as follows:
32-22 (a) This [Subject to this section, this] chapter does not
32-23 impose a tax on:
32-24 (1) the United States;
32-25 (2) a governmental entity of the United States[, this
32-26 state, or an agency, institution, board, or commission of this
33-1 state other than an institution of higher education;]
33-2 [(2) -an officer or employee of a state governmental
33-3 entity described by Subdivision (1) when traveling on or otherwise
33-4 engaged in the course of official duties for the governmental
33-5 entity]; or
33-6 (3) an officer or employee of a governmental entity of
33-7 the United States when traveling on or otherwise engaged in the
33-8 course of official duties for the governmental entity [if the
33-9 governmental entity directly pays to the hotel the price for the
33-10 room].
33-11 (b) This state, or an agency, institution, board, or
33-12 commission of this state other than an institution of higher
33-13 education [A governmental entity otherwise excepted under this
33-14 section] shall pay the tax imposed by this chapter and is entitled
33-15 to a refund of the amount of tax paid in accordance with Section
33-16 156.154.
33-17 (c) A state officer or employee of a state governmental
33-18 entity described by Subsection (b) [(a)(2)] who is entitled to
33-19 reimbursement for the cost of lodging and for whom a special
33-20 provision or exception to the general rate of reimbursement under
33-21 the General Appropriations Act is not applicable shall pay the tax
33-22 imposed by [under] this chapter [as if it were imposed by this
33-23 chapter]. The state governmental entity with whom the person is
33-24 associated is entitled under Section 156.154 to a refund of the tax
33-25 paid.
33-26 (d) A state officer or employee of a state governmental
34-1 entity described by Subsection (b) [(a)(2)] for whom a special
34-2 provision or exception to the general rate of reimbursement under
34-3 the General Appropriations Act applies and who is provided with
34-4 photo identification verifying the identity and exempt status of
34-5 the person is not required to pay the tax and is not entitled to a
34-6 refund. The photo identification of a state officer or employee
34-7 described by this section may be modified for the purposes of this
34-8 section.
34-9 SECTION 41. Section 171.063, Tax Code, is amended by
34-10 amending Subsection (a) and by adding Subsection (h) to read as
34-11 follows:
34-12 (a) The following corporations are exempt from the franchise
34-13 tax:
34-14 (1) a nonprofit corporation exempted from the federal
34-15 income tax under Section 501(c)(3), (4), (5), (6), (7), (8), (10),
34-16 or (19), Internal Revenue Code which in the case of a nonprofit
34-17 hospital means a hospital providing community benefits that include
34-18 charity care and government-sponsored indigent health care
34-19 [community benefits] as set forth in Subchapter D, Chapter 311,
34-20 Health and Safety Code;
34-21 [Paragraph (A), (B), (C), (D), (E), (F), or (G):]
34-22 [(A) charity care and government-sponsored
34-23 indigent health care are provided at a level which is reasonable in
34-24 relation to the community needs, as determined through the
34-25 community needs assessment, the available resources of the hospital
34-26 or hospital system, and the tax-exempt benefits received by the
35-1 hospital or hospital system;]
35-2 [(B) charity care and government-sponsored
35-3 indigent health care are provided in an amount equal to at least
35-4 four percent of the hospital's or hospital system's net patient
35-5 revenue;]
35-6 [(C) charity care and government-sponsored
35-7 indigent health care are provided in an amount equal to at least
35-8 100 percent of the hospital's or hospital system's tax-exempt
35-9 benefits, excluding federal income tax;]
35-10 [(D) for tax periods beginning before January 1,
35-11 1996, charity care and community benefits are provided in a
35-12 combined amount equal to at least five percent of the hospital's
35-13 net patient revenue, provided that charity care and
35-14 government-sponsored indigent health care are provided in an amount
35-15 equal to at least three percent of net patient revenue;]
35-16 [(E) for tax periods beginning after December
35-17 31, 1995, charity care and community benefits are provided in a
35-18 combined amount equal to at least five percent of the hospital's or
35-19 hospital system's net patient revenue, provided that charity care
35-20 and government-sponsored indigent health care are provided in an
35-21 amount equal to at least four percent of net patient revenue;]
35-22 [(F) a nonprofit hospital that has been
35-23 designated as a disproportionate share hospital under the state
35-24 Medicaid program in the current year or in either of the previous
35-25 two fiscal years is considered to have provided a reasonable amount
35-26 of charity care and government-sponsored indigent health care and
36-1 is considered in compliance with the standards provided by this
36-2 subsection; or]
36-3 [(G) a hospital operated on a nonprofit basis
36-4 that is located in a county with a population of less than 50,000
36-5 and in which the entire county or the population of the entire
36-6 county has been designated as a health professionals shortage area
36-7 is considered in compliance with the standards provided by this
36-8 subsection;]
36-9 (2) a corporation exempted under Section 501(c)(2) or
36-10 (25), Internal Revenue Code, if the corporation or corporations for
36-11 which it holds title to property is either exempt from or not
36-12 subject to the franchise tax; and
36-13 (3) a corporation exempted from federal income tax
36-14 under Section 501(c)(16), Internal Revenue Code. [; and]
36-15 [(4) a nonprofit corporation exempted from the federal
36-16 income tax under Section 501(c)(3), Internal Revenue Code, that
36-17 does not receive any payment for providing health care services to
36-18 inpatients or outpatients from any source including but not limited
36-19 to the patient or person legally obligated to support the patient,
36-20 third-party payors, Medicare, Medicaid, or any other state or local
36-21 indigent care program. Payment for providing health care services
36-22 does not include charitable donations, legacies, bequests, or
36-23 grants or payments for research.]
36-24 [For purposes of satisfying Paragraph (E) of Subdivision (1),
36-25 a hospital or hospital system may not change its existing fiscal
36-26 year unless the hospital or hospital system changes its ownership
37-1 or corporate structure as a result of a sale or merger.]
37-2 [For purposes of this subsection, a hospital that satisfies
37-3 Paragraph (A), (F), or (G) of Subdivision (1) shall be excluded in
37-4 determining a hospital system's compliance with the standards
37-5 provided by Paragraph (B), (C), (D), or (E) of Subdivision (1).]
37-6 [For purposes of this subsection, the terms "charity care,"
37-7 "government-sponsored indigent health care," "health care
37-8 organization," "hospital system," "net patient revenue," "nonprofit
37-9 hospital," and "tax-exempt benefits" have the meanings set forth in
37-10 Sections 311.031 and 311.042, Health and Safety Code. A
37-11 determination of the amount of community benefits and charity care
37-12 and government-sponsored indigent health care provided by a
37-13 hospital or hospital system and the hospital's or hospital system's
37-14 compliance with the requirements of Section 311.045, Health and
37-15 Safety Code, shall be based on the most recently completed and
37-16 audited prior fiscal year of the hospital or hospital system.]
37-17 [A requirement that a nonprofit hospital provide charity care
37-18 and community benefits under this subsection may be satisfied by a
37-19 donation of money to the Texas Healthy Kids Corporation established
37-20 by Chapter 109, Health and Safety Code, provided that:]
37-21 [(1) the money is donated to be used for a purpose
37-22 described by Section 109.033(c), Health and Safety Code; and]
37-23 [(2) not more than 10 percent of the charity care
37-24 required under any provision of this subsection may be satisfied by
37-25 the donation.]
37-26 [The providing of charity care and government-sponsored
38-1 indigent health care in accordance with Paragraph (A) of
38-2 Subdivision (1) shall be guided by the prudent business judgment of
38-3 the hospital which will ultimately determine the appropriate level
38-4 of charity care and government-sponsored indigent health care based
38-5 on the community needs, the available resources of the hospital,
38-6 the tax-exempt benefits received by the hospital, and other factors
38-7 that may be unique to the hospital, such as the hospital's volume
38-8 of Medicare and Medicaid patients. These criteria shall not be
38-9 determinative factors, but shall be guidelines contributing to the
38-10 hospital's decision along with other factors which may be unique to
38-11 the hospital. The formulas contained in Paragraphs (B), (C), (D),
38-12 and (E) of Subdivision (1) shall also not be considered
38-13 determinative of a reasonable amount of charity care and
38-14 government-sponsored indigent health care.]
38-15 [The requirements of this subsection shall not apply to the
38-16 extent a hospital or hospital system demonstrates that reductions
38-17 in the amount of community benefits, charity care, and
38-18 government-sponsored indigent health care are necessary to maintain
38-19 financial reserves at a level required by a bond covenant, are
38-20 necessary to prevent the hospital or hospital system from
38-21 endangering its ability to continue operations, or if the hospital,
38-22 as a result of a natural or other disaster, is required
38-23 substantially to curtail its operations.]
38-24 [In any fiscal year that a hospital or hospital system,
38-25 through unintended miscalculation, fails to meet any of the
38-26 standards in Subdivision (1), the hospital or hospital system shall
39-1 not lose its tax-exempt status without the opportunity to cure the
39-2 miscalculation in the fiscal year following the fiscal year the
39-3 failure is discovered by both meeting one of the standards and
39-4 providing an additional amount of charity care and
39-5 government-sponsored indigent health care that is equal to the
39-6 shortfall from the previous fiscal year. A hospital or hospital
39-7 system may apply this provision only once every five years.]
39-8 (h) A requirement that a nonprofit hospital provide charity
39-9 care and community benefits under Subsection (a)(1) may be
39-10 satisfied by a donation of money to the Texas Healthy Kids
39-11 Corporation established by Chapter 109, Health and Safety Code, if:
39-12 (1) the money is donated to be used for a purpose
39-13 described by Section 109.033(c), Health and Safety Code; and
39-14 (2) not more than 10 percent of the charity care
39-15 required under any provision of Section 311.045, Health and Safety
39-16 Code, may be satisfied by the donation.
39-17 SECTION 42. Sections 171.063(c) and (d), Tax Code, are
39-18 amended to read as follows:
39-19 (c) A corporation's exemption under Subsection (b) of this
39-20 section is established by furnishing the comptroller with a copy of
39-21 the Internal Revenue Service's letter of exemption issued to the
39-22 corporation. [The copy of the letter must be filed with the
39-23 comptroller within 15 months after the day that is the last day of
39-24 a calendar month and that is nearest to the date of the
39-25 corporation's charter or certificate of authority.]
39-26 (d) If the Internal Revenue Service has not timely issued to
40-1 a corporation a letter of exemption, evidence establishing the
40-2 corporation's provisional exemption under this section is
40-3 sufficient if the corporation timely files with the comptroller
40-4 [within the 15-month period established by Subsection (c) of this
40-5 section] evidence that the corporation has applied in good faith
40-6 for the federal tax exemption. The evidence must be filed not
40-7 later than the 15th month after the day that is the last day of a
40-8 calendar month and that is nearest to the date of the corporation's
40-9 charter or certificate of authority.
40-10 SECTION 43. The heading of Subchapter C, Chapter 171, Tax
40-11 Code, is amended to read as follows:
40-12 SUBCHAPTER C. DETERMINATION OF TAXABLE CAPITAL AND TAXABLE EARNED
40-13 SURPLUS; ALLOCATION AND APPORTIONMENT
40-14 SECTION 44. The heading of Section 171.1015, Tax Code, is
40-15 amended to read as follows:
40-16 Sec. 171.1015 REDUCTION OF TAXABLE CAPITAL OR TAXABLE EARNED
40-17 SURPLUS FOR INVESTMENT IN AN ENTERPRISE ZONE.
40-18 SECTION 45. Section 171.1015(f)(1), Tax Code, is amended to
40-19 read as follows:
40-20 (1) "Enterprise project" means a person designated by
40-21 the Texas Department of Economic Development [Commerce] as an
40-22 enterprise project under Chapter 2303, Government Code.
40-23 SECTION 46. Section 171.1015(g), Tax Code, is amended to
40-24 read as follows:
40-25 (g) Only qualified businesses that have been certified as
40-26 eligible for a tax deduction under this section by the Texas
41-1 Department of Economic Development [Commerce] to the comptroller
41-2 and the Legislative Budget Board are entitled to the tax deduction.
41-3 SECTION 47. The heading of Section 171.1016, Tax Code, is
41-4 amended to read as follows:
41-5 Sec. 171.1016 REDUCTION OF TAXABLE CAPITAL OR TAXABLE EARNED
41-6 SURPLUS FOR INVESTMENT IN A READJUSTMENT ZONE.
41-7 SECTION 48. Section 171.1016(f)(1), Tax Code, is amended to
41-8 read as follows:
41-9 (1) "Defense readjustment project" means a person
41-10 designated by the Texas Department of Economic Development
41-11 [Commerce] as a defense readjustment project under Chapter 2310,
41-12 Government Code.
41-13 SECTION 49. Section 171.1016(g), Tax Code, is amended to
41-14 read as follows:
41-15 (g) Only qualified businesses that have been certified as
41-16 eligible for a tax deduction under this section by the Texas
41-17 Department of Economic Development [Commerce] to the comptroller
41-18 and the Legislative Budget Board are entitled to the tax deduction.
41-19 SECTION 50. The heading of Section 171.107, Tax Code, is
41-20 amended to read as follows:
41-21 Sec. 171.107 DEDUCTION OF COST OF SOLAR ENERGY DEVICE FROM
41-22 TAXABLE CAPITAL OR TAXABLE EARNED SURPLUS APPORTIONED TO THIS
41-23 STATE.
41-24 SECTION 51. Section 171.110, Tax Code, is amended by adding
41-25 Subsections (i) and (j) to read as follows:
41-26 (i) For purposes of this section, any person designated as
42-1 an officer is presumed to be an officer if that person:
42-2 (1) holds an office created by the board of directors
42-3 or pursuant to the corporate charter or bylaws, and
42-4 (2) has legal authority to bind the corporation with
42-5 third parties by executing contracts or other legal documents.
42-6 (j) A corporation may rebut the presumption described in
42-7 Subsection (i) that a person is an officer if it conclusively
42-8 shows, through the person's job description or other documentation,
42-9 that the person does not participate or have authority to
42-10 participate in significant policymaking aspects of the corporate
42-11 operations.
42-12 SECTION 52. Section 171.501(a), Tax Code, is amended to read
42-13 as follows:
42-14 (a) A corporation that has been certified a qualified
42-15 business as provided by Chapter 2303, Government Code may apply for
42-16 and be granted a refund of franchise tax paid with an initial or
42-17 annual report if the governing body or bodies certify to the Texas
42-18 Department of Economic Development [Commerce] that the business has
42-19 created 10 or more new jobs in its enterprise zone held by
42-20 qualified employees during the calendar year that contains the end
42-21 of the accounting period on which the report is based. The Texas
42-22 Department of Economic Development [Commerce] shall certify
42-23 eligibility for any refund to the comptroller.
42-24 SECTION 53. The heading of Subchapter C, Chapter 183, Tax
42-25 Code, is amended to read as follows:
42-26 SUBCHAPTER C. MIXED BEVERAGE TAX CLEARANCE [FUND]
43-1 SECTION 54. The heading of Section 183.051, Tax Code, is
43-2 amended to read as follows:
43-3 Sec. 183.051. MIXED BEVERAGE TAX CLEARANCE [FUND]
43-4 SECTION 55. Section 183.051(b), Tax Code, is amended to read
43-5 as follows:
43-6 (b) The comptroller shall issue to each county a warrant
43-7 drawn on the general revenue [mixed beverage tax clearance] fund in
43-8 the amount of 10.7143 percent of mixed beverage receipts from
43-9 permittees within the county during the quarter and shall issue to
43-10 each incorporated municipality a warrant drawn on that fund in the
43-11 amount of 10.7143 percent of mixed beverage receipts from
43-12 permittees within the incorporated municipality during the quarter.
43-13 [The remainder of the receipts for the quarter and all interest
43-14 earned on that fund shall be transferred to the general revenue
43-15 fund.]
43-16 SECTION 56. Section 191.085(b), Tax Code, is amended to read
43-17 as follows:
43-18 (b) The person shall keep the record open for four [two]
43-19 years for inspection by the comptroller or the attorney general.
43-20 SECTION 57. Section 203.051(a), Tax Code, is amended to read
43-21 as follows:
43-22 (a) A producer shall keep a complete record of all sulphur
43-23 he produces in this state. A producer may destroy a record
43-24 required by this section four [three] years after the last entry in
43-25 the record.
43-26 SECTION 58. Section 321.103, Tax Code, is amended by adding
44-1 Subsections (e), (f), and (g) to read as follows:
44-2 (e) If as a result of the imposition or increase in a sales
44-3 and use tax by a municipality in which there is located all or part
44-4 of a local governmental entity with an existing sales and use tax
44-5 or as a result of the annexation by a municipality of all or part
44-6 of the territory in a local governmental entity with an existing
44-7 sales and use tax the overlapping local sales and use taxes in the
44-8 area will exceed two percent, the entity's sales and use tax is
44-9 automatically reduced in that area to a rate that when added to the
44-10 combined rate of local sales and use taxes will equal two percent.
44-11 (f) If an entity's rate is reduced in accordance with
44-12 Subsection (e), the comptroller shall withhold from the
44-13 municipality's monthly sales and use tax allocation an amount equal
44-14 to the amount that would have been collected by the entity had the
44-15 municipality not imposed or increased its sales and use tax or
44-16 annexed the area in the entity less amounts that the entity
44-17 collects following the municipality's levy of or increase in its
44-18 sales and use tax or annexation of the area in the district. The
44-19 comptroller shall withhold and pay the amount withheld to the
44-20 entity under policies or procedures that the comptroller considers
44-21 reasonable.
44-22 (g) A transit authority is not a local governmental entity
44-23 for the purposes of Subsections (e) and (f).
44-24 SECTION 59. Section 323.102(c), Tax Code, is amended to read
44-25 as follows:
44-26 (c) A tax imposed under Section 323.105 of this code or
45-1 Chapter 326, Local Government Code, takes effect on the first day
45-2 of the first calendar quarter after the expiration of the first
45-3 complete calendar quarter occurring after the date on which the
45-4 comptroller receives a notice of the action as required by Section
45-5 323.405(b).
45-6 SECTION 60. Section 323.105(e), Tax Code, is amended to read
45-7 as follows:
45-8 (e) The comptroller shall remit to the county amounts
45-9 collected at the rate imposed under this section as part of the
45-10 regular allocation of county tax revenue collected by the
45-11 comptroller, if the district is composed of the entire county. The
45-12 comptroller [county] shall, if the district is composed of an area
45-13 less than the entire county, remit that amount to the district.
45-14 Retailers may not be required to use the allocation and reporting
45-15 procedures in the collection of taxes under this section different
45-16 from the procedures that retailers use in the collection of other
45-17 sales and use taxes under this chapter. An item, transaction, or
45-18 service that is taxable in a county under a sales or use tax
45-19 authorized by another section of this chapter is taxable under this
45-20 section. An item, transaction, or service that is not taxable in a
45-21 county under a sales or use tax authorized by another section of
45-22 this chapter is not taxable under this section.
45-23 SECTION 61. Section 351.006, Tax Code, is amended to read as
45-24 follows:
45-25 Sec. 351.006. Exemption. (a) A United States governmental
45-26 entity described in Section 156.103(a) is exempt from the payment
46-1 of tax authorized by this chapter. [A governmental entity excepted
46-2 from the tax imposed by Chapter 156 under Section 156.103(a)(1) or
46-3 (a)(3) shall pay the tax imposed by this chapter but is entitled to
46-4 a refund of the tax paid.]
46-5 (b) A state governmental entity described in Section
46-6 156.103(b) shall pay the tax imposed by this chapter but is
46-7 entitled to a refund of the tax paid.
46-8 (c) A person who is described by Section 156.103(d) is
46-9 exempt from the payment of the tax authorized by this chapter.
46-10 (d) [(c)] A person who is described by Section 156.103(c)
46-11 shall pay the tax imposed by this chapter but the state
46-12 governmental entity with whom the person is associated is entitled
46-13 to a refund of the tax paid.
46-14 (e) [(d)] To receive a refund of tax paid under this
46-15 chapter, the governmental entity entitled to the refund must file a
46-16 refund claim on a form provided by the municipality and containing
46-17 the information required by the municipality. The comptroller by
46-18 rule shall prescribe the form that must be used and the information
46-19 that must be provided.
46-20 (f) [(e)] A governmental entity may file a refund claim with
46-21 the municipality under this chapter only for each calendar quarter
46-22 for all reimbursements accrued during that quarter. The
46-23 municipality may adopt an ordinance to enforce this section.
46-24 SECTION 62. Section 352.007, Tax Code, is amended to read as
46-25 follows:
46-26 Sec. 352.007. Exemption. (a) A United States governmental
47-1 entity described in Section 156.103(a) is exempt from the payment
47-2 of tax authorized by this chapter. [A governmental entity excepted
47-3 from the tax imposed by Chapter 156 under Section 156.103(a)(1) or
47-4 (a)(3) shall pay the tax imposed by this chapter but is entitled to
47-5 a refund of the tax paid.]
47-6 (b) A state governmental entity subject to the tax imposed
47-7 by Chapter 156 under Section 156.103(b) shall pay the tax imposed
47-8 by this chapter but is entitled to a refund of the tax paid.
47-9 (c) A person who is described by Section 156.103(d) is
47-10 exempt from the payment of the tax authorized by this chapter.
47-11 (d) [(c)] A person who is described by Section 156.103(c)
47-12 shall pay the tax imposed by this chapter but the state
47-13 governmental entity with whom the person is associated is entitled
47-14 to a refund of the tax paid.
47-15 (e) [(d)] To receive a refund of a tax paid under this
47-16 chapter, the governmental entity entitled to the refund must file a
47-17 refund claim on a form provided by the county and containing the
47-18 information required by the county. The comptroller by rule shall
47-19 prescribe the form that must be used and the information that must
47-20 be provided.
47-21 (f) [(e)] A governmental entity may file a refund claim with
47-22 the county under this chapter only for each calendar quarter for
47-23 all reimbursements accrued during that quarter. The county may
47-24 adopt a resolution to enforce this section.
47-25 SECTION 63. Subsection 4B(e), Development Corporation Act of
47-26 1979 (Article 5190.6, Vernon's Texas Civil Statutes), as amended by
48-1 Section 3, Chapter 1022, and Section 12, Chapter 1031, Acts of the
48-2 73rd Legislature, Regular Session, 1993, is reenacted to read as
48-3 follows:
48-4 (e) The rate of a tax adopted under this section must be
48-5 one-eighth, one-fourth, three-eighths, or one-half of one percent.
48-6 The ballot proposition at the election held to adopt the tax must
48-7 specify the rate of the tax to be adopted. A corporation that
48-8 holds an election to reduce a tax imposed under Section 4A of this
48-9 Act may in a separate proposition on the same ballot adopt a tax
48-10 under this section. If an eligible city adopts the tax, a tax is
48-11 imposed on the receipts from the sale at retail of taxable items
48-12 within the eligible city at the rate approved at the election.
48-13 There is also imposed an excise tax on the use, storage, or other
48-14 consumption within the eligible city of tangible personal property
48-15 purchased, leased, or rented from a retailer during the period that
48-16 the tax is effective within the eligible city. The rate of the
48-17 excise tax is the same as the rate of the sales tax portion of the
48-18 tax and is applied to the sale price of the tangible personal
48-19 property.
48-20 SECTION 64. Section 152.062(d), Tax Code, is repealed.
48-21 SECTION 65. Each change in law made to the following
48-22 provisions by this Act is a clarification of existing law and does
48-23 not imply that existing law may be construed as inconsistent with
48-24 the law as amended by this Act:
48-25 (1) Section 102.075, Code of Criminal Procedure;
48-26 (2) Section 9, Texas State College and University Employees
49-1 Uniform Insurance Benefits Act (Article 3.50-3, Vernon's Texas
49-2 Insurance Code;
49-3 (3) Section 11, Texas Public School Employees Group
49-4 Insurance Act (Article 3.50-4, Insurance Code);
49-5 (4) Section 326.029, Local Government Code;
49-6 (5) Section 326.092, Local Government Code;
49-7 (6) Section 151.350(d), Tax Code;
49-8 (7) Section 152.041, Tax Code;
49-9 (8) Section 153.117, Tax Code;
49-10 (9) Section 153.119, Tax Code;
49-11 (10) Section 153.206, Tax Code;
49-12 (11) Section 153.219, Tax Code;
49-13 (12) Section 171.063, Tax Code;
49-14 (13) The heading of Subchapter C, Chapter 171, Tax Code;
49-15 (14) The headings of Sections 171.1015, 171.1016, and
49-16 171.107, Tax Code;
49-17 (15) Section 171.110, Tax Code;
49-18 (16) Section 191.085, Tax Code; and
49-19 (17) Section 203.051, Tax Code.
49-20 SECTION 66. The comptroller of public accounts may adopt
49-21 rules and take other actions before October 1, 1999, as the
49-22 comptroller deems necessary or advisable to prepare for the taking
49-23 effect of this Act.
49-24 SECTION 67. (a) Except as provided by Subsections (b), (c),
49-25 and (d), this Act takes effect October 1, 1999.
49-26 (b) Section 3 of this Act takes effect January 1, 2000, and
50-1 applies to reporting periods beginning on or after that date.
50-2 (c) Sections 41 through 52 of this Act take effect
50-3 January 1, 2000, and apply to a report originally due on or after
50-4 that date.
50-5 (d) Sections 59 and 66 of this Act take effect on the
50-6 earliest date on which they may take effect under Section 39,
50-7 Article III, Texas Constitution.
50-8 SECTION 68. The importance of this legislation and the
50-9 crowded condition of the calendars in both houses create an
50-10 emergency and an imperative public necessity that the
50-11 constitutional rule requiring bills to be read on three several
50-12 days in each house be suspended, and this rule is hereby suspended,
50-13 and that this Act take effect and be in force from and after its
50-14 passage, and it is so enacted.