By: Duncan S.R. No. 1191
SENATE RESOLUTION
1-1 BE IT RESOLVED by the Senate of the State of Texas, 76th
1-2 Legislature, Regular Session, 1999, That Senate Rule 12.03 be
1-3 suspended in part, as provided by Senate Rule 12.08, to enable the
1-4 conference committee appointed to resolve the differences on H.B.
1-5 No. 3211, relating to state fiscal matters, to consider and take
1-6 action on the following specific matters:
1-7 (1) Senate Rule 12.03(4) is suspended to permit the
1-8 committee to add additional text not included in either the house
1-9 or senate version of the bill, consisting of a new article of the
1-10 bill, to read as follows:
1-11 ARTICLE 2. TECHNICAL CHANGES REGARDING TAXES AND FEES
1-12 SECTION 2.01. Subsection (g), Article 102.075, Code of
1-13 Criminal Procedure, is amended to read as follows:
1-14 (g) A municipality or county may retain 10 percent of the
1-15 money collected under this article as a service fee for the
1-16 collection if the municipality or county remits the funds to the
1-17 comptroller within the period prescribed in Subsection (f). The
1-18 municipality or county may retain any interest accrued on the money
1-19 if the custodian of the money deposited in the treasury keeps
1-20 records of the amount of money collected under this article that is
1-21 on deposit in the treasury and remits the funds to the comptroller
1-22 within the period prescribed in Subsection (f).
1-23 SECTION 2.02. Section 403.014(b), Government Code, is
1-24 amended to read as follows:
2-1 (b) The report must include:
2-2 (1) an analysis of each special provision that reduces
2-3 the amount of tax payable, to include an estimate of the loss of
2-4 revenue for a six-year period including the current fiscal biennium
2-5 and a citation of the statutory or legal authority for the
2-6 provision; and
2-7 (2) for provisions reducing revenue by more than one
2-8 percent of total revenue for a tax covered by this section:
2-9 (A) [,] the effect of each provision on the
2-10 distribution of the tax burden by income class and industry or
2-11 business class, as appropriate; and
2-12 (B) the effect of each provision on total income
2-13 by income class.
2-14 SECTION 2.03. Section 403.0141(c), Government Code, is
2-15 amended to read as follows:
2-16 (c) To the extent data is available, the incidence impact
2-17 analysis under Subsections (a) and (b):
2-18 (1) shall evaluate the tax burden:
2-19 (A) on the overall income distribution, using a
2-20 systemwide incidence measure or other appropriate measures of
2-21 equality and inequality; and
2-22 (B) on income classes, including, at a minimum,
2-23 quintiles of the income distribution, on renters and homeowners, on
2-24 industry or business classes, as appropriate, and on various types
2-25 of business organizations;
2-26 (2) may evaluate the tax burden:
3-1 (A) by other appropriate taxpayer
3-2 characteristics, such as whether the taxpayer is a farmer, rancher,
3-3 retired elderly, or resident or nonresident of the state; and
3-4 (B) by distribution of impact on consumers,
3-5 labor, capital, and out-of-state persons and entities; [and]
3-6 (3) shall evaluate the effect of each tax on total
3-7 income by income group; and
3-8 (4) shall:
3-9 (A) use the broadest measure of economic income
3-10 for which reliable data is available; and
3-11 (B) include a statement of the incidence
3-12 assumptions that were used in making the analysis.
3-13 SECTION 2.04. Section 12(b), Article 1.14-1, Insurance Code,
3-14 is amended to read as follows:
3-15 (b) The report shall be filed and any tax due shall be paid
3-16 by the insured or by any other person designated by the insured.
3-17 The report and tax are due on or before May 15 [March 1] of the
3-18 calendar year after the calendar year in which the insurance was
3-19 procured, continued, or renewed or on another date prescribed by
3-20 the comptroller.
3-21 SECTION 2.05. Sections 12(a) and (b), Article 1.14-2,
3-22 Insurance Code, are amended to read as follows:
3-23 (a) The premiums charged for surplus lines insurance are
3-24 subject to a premium receipts tax of 4.85 percent of gross premiums
3-25 charged for such insurance. The term premium includes all
3-26 premiums, membership fees, assessments, dues or any other
4-1 consideration for insurance. Such tax shall be in lieu of all
4-2 other insurance taxes. The surplus lines agent shall collect from
4-3 the insured the amount of the tax at the time of delivery of the
4-4 cover note, certificate of insurance, policy or other initial
4-5 confirmation of insurance, in addition to the full amount of the
4-6 gross premium charged by the insurer for the insurance. No agent
4-7 shall absorb such tax nor shall any agent, as an inducement for
4-8 insurance or for any other reason, rebate all or any part of such
4-9 tax or his commission. The surplus lines agent shall file a report
4-10 and pay taxes to the comptroller on or before March 1 of each year
4-11 on forms prescribed by the comptroller. The [the] amount of taxes
4-12 shall be based on gross premiums written or received for such
4-13 insurance placed through an eligible surplus lines insurer during
4-14 the calendar year ending on the preceding December 31. A tax
4-15 prepayment shall be required any time accrued taxes due equal or
4-16 exceed $70,000. The prepayment of the accrued taxes, with a form
4-17 prescribed by the comptroller, shall be due by the 15th day of the
4-18 month following the month in which accrued taxes total $70,000 [and
4-19 shall pay to the comptroller the tax as provided for by this
4-20 Article]. If a surplus lines policy covers risks or exposures only
4-21 partially in this state, the tax payable shall be computed on the
4-22 portions of the premium which are properly allocated to the risks
4-23 or exposures located in this state. In determining the amount of
4-24 premiums taxable in this state, all premiums written, procured, or
4-25 received in this state and all premiums on policies negotiated in
4-26 this state shall be deemed written on property or risks located or
5-1 resident in this state, except such premiums as are properly
5-2 allocated or apportioned and reported as premiums which may be
5-3 subject to taxation by any other state or states. Premiums that
5-4 are properly allocated to any other state or states that are
5-5 specifically exempt from taxation under the regulations of that
5-6 state or states are not taxable in this state. Premiums on risks
5-7 or exposures which are properly allocated to federal waters,
5-8 international waters or under the jurisdiction of a foreign
5-9 government shall not be taxable by this state. In event of
5-10 cancellation and rewriting of any surplus lines insurance contract
5-11 the additional premium for premium receipts tax purposes shall be
5-12 the premium in excess of the unearned premium of the canceled
5-13 insurance contract.
5-14 (b) All surplus lines premium receipt taxes collected by a
5-15 surplus lines agent are trust funds in his hands [and the property
5-16 of this state. Such funds shall be maintained by the surplus lines
5-17 agent in a separate account and shall not be mingled with any other
5-18 funds, either business or private]. Any surplus lines agent who
5-19 fails or refuses to pay over to the state the surplus lines premium
5-20 receipts tax at the time required by [in] this section, or who
5-21 fraudulently withholds or appropriates or otherwise uses such money
5-22 or any portions thereof belonging to the state is guilty of theft
5-23 and shall be punished as provided by law for the crime of theft,
5-24 irrespective of whether any such surplus lines agent has or claims
5-25 to have any interest in such money so received by him.
5-26 SECTION 2.06. Section 9(b), Texas State College and
6-1 University Employees Uniform Insurance Benefits Act (Article
6-2 3.50-3, Vernon's Texas Insurance Code), is amended to read as
6-3 follows:
6-4 (b) Premiums on policies, insurance contracts, or agreements
6-5 with health maintenance organizations established under this Act
6-6 are not subject to any state tax, regulatory fee, or surcharge,
6-7 including premium or maintenance taxes or fees.
6-8 SECTION 2.07. Section 11(b), Texas Public School Employees
6-9 Group Insurance Act (Article 3.50-4, Insurance Code), is amended to
6-10 read as follows:
6-11 (b) A premium or contribution on a policy, insurance
6-12 contract, or agreement authorized as provided by this article is
6-13 not subject to any state tax, regulatory fee, or surcharge,
6-14 including premium or maintenance taxes or fees.
6-15 SECTION 2.08. Section 326.029(a), Local Government Code, is
6-16 amended to read as follows:
6-17 (a) If a majority of the votes received in the election
6-18 favor the creation of the district and the adoption of the sales
6-19 and use tax, the commissioners court shall by resolution or order
6-20 declare that the district is created and shall declare the amount
6-21 of the local sales and use tax adopted and enter the result in its
6-22 minutes.
6-23 SECTION 2.09. Section 326.092(a), Local Government Code, is
6-24 amended to read as follows:
6-25 (a) Chapter 323, Tax Code, to the extent not inconsistent
6-26 with this chapter, governs the imposition, computation,
7-1 administration, and governance of the tax under this subchapter,
7-2 except that Sections 323.101, 323.105, [and] 323.404, and 323.406
7-3 through 323.408, Tax Code, do not apply.
7-4 SECTION 2.10. Section 101.003, Tax Code, is amended by
7-5 adding Subdivision (13) to read as follows:
7-6 (13) "Tax" means a tax, fee, assessment, charge, or
7-7 other amount that the comptroller is authorized to administer.
7-8 SECTION 2.11. Section 111.0041(b), Tax Code, is amended to
7-9 read as follows:
7-10 (b) This section prevails over any other conflicting
7-11 provision of this title [except Section 191.024(b) of this code].
7-12 SECTION 2.12. Section 111.023, Tax Code, is amended to read
7-13 as follows:
7-14 Sec. 111.023. WRITTEN AUTHORIZATION. (a) The comptroller
7-15 may require that a report, return, declaration, claim for refund,
7-16 or other document that is required or permitted to be filed with
7-17 the comptroller and that is submitted by an attorney, accountant,
7-18 or other representative of a taxpayer [person] on behalf of the
7-19 taxpayer [person] be accompanied by express written authorization
7-20 of the taxpayer [person] in whose name or on whose behalf it is
7-21 purportedly submitted.
7-22 (b) An officer, director, or employee of the taxpayer whose
7-23 duties include administering the taxpayer's rights and
7-24 responsibilities with the comptroller may sign the written
7-25 authorization. The authorization must include the title and
7-26 telephone number of the officer, director, or employee who signs
8-1 the authorization for verification by the comptroller.
8-2 (c) The comptroller may impose a requirement of Subsection
8-3 (b) on a taxpayer's assignment of a claim for refund.
8-4 SECTION 2.13. Section 111.104(e), Tax Code, is amended to
8-5 read as follows:
8-6 (e) This section applies to all taxes and license fees
8-7 collected or administered by the comptroller, except the state
8-8 property tax [and those taxes that qualify for refund allowed under
8-9 Section 151.318(g) or (n)].
8-10 SECTION 2.14. Section 111.107, Tax Code, is amended to read
8-11 as follows:
8-12 Sec. 111.107. WHEN REFUND OR CREDIT IS PERMITTED. Except as
8-13 otherwise expressly provided, a person may request a refund or a
8-14 credit or the comptroller may make a refund or issue a credit for
8-15 the overpayment of a tax imposed by this title at any time before
8-16 the expiration of the period during which the comptroller may
8-17 assess a deficiency for the tax and not thereafter unless the
8-18 refund or credit is requested:
8-19 (1) under Subchapter B of Chapter 112 and the refund
8-20 is made or the credit is issued under a court order;
8-21 (2) under the provision of Section 111.104(c)(3)
8-22 applicable to a refund claim filed after a jeopardy or deficiency
8-23 determination becomes final; or
8-24 (3) under Chapter 153, except Section 153.1195(e),
8-25 153.121(d), 153.2225(e), or 153.224(d)[; or]
8-26 [(4) under Section 151.318(g) or (n)].
9-1 SECTION 2.15. Sections 151.310(c) and (e), Tax Code, are
9-2 amended to read as follows:
9-3 (c) An organization that qualifies for an exemption under
9-4 Subsection (a)(1) or (a)(2) of this section, and each bona fide
9-5 chapter of the organization, may hold two tax-free sales or
9-6 auctions under this subsection during a calendar year and each
9-7 tax-free sale or auction may continue for one day only. The sale
9-8 of a taxable item the sales price of which is $5,000 or less by a
9-9 qualified organization or chapter of the organization at a tax-free
9-10 sale or auction is exempted from the sales tax imposed by
9-11 Subchapter C of this chapter, except that a taxable item
9-12 manufactured by or donated to the qualified organization or chapter
9-13 of the organization may be sold tax free regardless of the sales
9-14 price to any purchaser other than the donor. The storage, use, or
9-15 consumption of a taxable item that is acquired from a qualified
9-16 organization or chapter of the organization at a tax-free sale or
9-17 auction and that is exempted under this subsection from the taxes
9-18 imposed by Subchapter C of this chapter is exempted from the use
9-19 tax imposed by Subchapter D of this chapter until the item is
9-20 resold or subsequently transferred.
9-21 (e) A nonprofit hospital or hospital system that qualifies
9-22 for an exemption under Subsection (a)(2) shall provide community
9-23 benefits that include charity care and government-sponsored
9-24 indigent health care [community benefits] as set forth in
9-25 Subchapter D, Chapter 311, Health and Safety Code. [Subdivision
9-26 (1), (2), (3), (4), (5), (6), (7), or (8) below:]
10-1 [(1) charity care and government-sponsored indigent
10-2 health care are provided at a level which is reasonable in relation
10-3 to the community needs, as determined through the community needs
10-4 assessment, the available resources of the hospital or hospital
10-5 system, and the tax-exempt benefits received by the hospital or
10-6 hospital system;]
10-7 [(2) charity care and government-sponsored indigent
10-8 health care are provided in an amount equal to at least four
10-9 percent of the hospital's or hospital system's net patient revenue;]
10-10 [(3) charity care and government-sponsored indigent
10-11 health care are provided in an amount equal to at least 100 percent
10-12 of the hospital's or hospital system's tax-exempt benefits,
10-13 excluding federal income tax;]
10-14 [(4) for tax periods beginning before January 1, 1996,
10-15 charity care and community benefits are provided in a combined
10-16 amount equal to at least five percent of the hospital's or hospital
10-17 system's net patient revenue, provided that charity care and
10-18 government-sponsored indigent health care are provided in an amount
10-19 equal to at least three percent of net patient revenue;]
10-20 [(5) for tax periods beginning after December 31,
10-21 1995, charity care and community benefits are provided in a
10-22 combined amount equal to at least five percent of the hospital's or
10-23 hospital system's net patient revenue, provided that charity care
10-24 and government-sponsored indigent health care are provided in an
10-25 amount equal to at least four percent of net patient revenue;]
10-26 [(6) a nonprofit hospital that has been designated as
11-1 a disproportionate share hospital under the state Medicaid program
11-2 in the current year or in either of the previous two fiscal years
11-3 is considered to have provided a reasonable amount of charity care
11-4 and government-sponsored indigent health care and is considered in
11-5 compliance with the standards provided by this subsection;]
11-6 [(7) a hospital operated on a nonprofit basis that is
11-7 located in a county with a population of less than 50,000 and in
11-8 which the entire county or the population of the entire county has
11-9 been designated as a health professionals shortage area is
11-10 considered to be in compliance with the standards provided by this
11-11 subsection; or]
11-12 [(8) a hospital providing health care services to
11-13 inpatients or outpatients without receiving any payment for
11-14 providing those services from any source, including the patient or
11-15 person legally obligated to support the patient, third-party
11-16 payors, Medicare, Medicaid, or any other state or local indigent
11-17 care program but excluding charitable donations, legacies,
11-18 bequests, or grants or payments for research, is considered to be
11-19 in compliance with the standards provided by this subsection.]
11-20 [For purposes of satisfying Subdivision (5), a hospital or
11-21 hospital system may not change its existing fiscal year unless the
11-22 hospital or hospital system changes its ownership or corporate
11-23 structure as a result of a sale or merger.]
11-24 [For purposes of this subsection, a hospital that satisfies
11-25 Subdivision (1), (6), (7), or (8) shall be excluded in determining
11-26 a hospital system's compliance with the standards provided by
12-1 Subdivision (2), (3), (4), or (5).]
12-2 [For purposes of this subsection, the terms "charity care,"
12-3 "government-sponsored indigent health care," "health care
12-4 organization," "hospital system," "net patient revenue," "nonprofit
12-5 hospital," and "tax-exempt benefits" have the meanings set forth in
12-6 Sections 311.031 and 311.042, Health and Safety Code. A
12-7 determination of the amount of community benefits and charity care
12-8 and government-sponsored indigent health care provided by a
12-9 hospital or hospital system and the hospital's or hospital system's
12-10 compliance with the requirements of this subsection and Section
12-11 311.045, Health and Safety Code, shall be based on the most
12-12 recently completed and audited prior fiscal year of the hospital or
12-13 hospital system.]
12-14 [The providing of charity care and government-sponsored
12-15 indigent health care in accordance with Subdivision (1) shall be
12-16 guided by the prudent business judgment of the hospital which will
12-17 ultimately determine the appropriate level of charity care and
12-18 government-sponsored indigent health care based on the community
12-19 needs, the available resources of the hospital, the tax-exempt
12-20 benefits received by the hospital, and other factors that may be
12-21 unique to the hospital, such as the hospital's volume of Medicare
12-22 and Medicaid patients. These criteria shall not be determinative
12-23 factors, but shall be guidelines contributing to the hospital's
12-24 decision along with other factors which may be unique to the
12-25 hospital. The formulas contained in Subdivisions (2), (3), (4),
12-26 and (5) shall also not be considered determinative of a reasonable
13-1 amount of charity care and government-sponsored indigent health
13-2 care.]
13-3 [The requirements of this subsection shall not apply to the
13-4 extent a hospital or hospital system demonstrates that reductions
13-5 in the amount of community benefits, charity care, and
13-6 government-sponsored indigent health care are necessary to maintain
13-7 financial reserves at a level required by a bond covenant, are
13-8 necessary to prevent the hospital or hospital system from
13-9 endangering its ability to continue operations, or if the hospital
13-10 or hospital system, as a result of a natural or other disaster, is
13-11 required substantially to curtail its operations.]
13-12 [In any fiscal year that a hospital or hospital system,
13-13 through unintended miscalculation, fails to meet any of the
13-14 standards in this subsection, the hospital or hospital system shall
13-15 not lose its tax-exempt status without the opportunity to cure the
13-16 miscalculation in the fiscal year following the fiscal year the
13-17 failure is discovered by both meeting one of the standards and
13-18 providing an additional amount of charity care and
13-19 government-sponsored indigent health care that is equal to the
13-20 shortfall from the previous fiscal year. A hospital or hospital
13-21 system may apply this provision only once every five years.]
13-22 SECTION 2.16. Section 151.3101, Tax Code, is amended by
13-23 adding Subsection (c) to read as follows:
13-24 (c) In this section, "educational organization" includes an
13-25 entity described by Section 61.003(8) or (15), Education Code.
13-26 SECTION 2.17. Section 151.312, Tax Code, is amended to read
14-1 as follows:
14-2 Sec. 151.312. PERIODICALS AND WRITINGS OF RELIGIOUS,
14-3 PHILANTHROPIC, CHARITABLE, HISTORICAL, SCIENTIFIC, AND SIMILAR
14-4 ORGANIZATIONS. Periodicals and writings, including those presented
14-5 on audio tape, videotape, and computer disk, that are published and
14-6 [or] distributed by a religious, philanthropic, charitable,
14-7 historical, scientific, or other similar organization that is not
14-8 operated for profit, but excluding an educational organization, are
14-9 exempted from the taxes imposed by this chapter.
14-10 SECTION 2.18. Section 151.317, Tax Code, is amended to read
14-11 as follows:
14-12 Sec. 151.317. GAS AND ELECTRICITY. (a) Subject to
14-13 Subsection (d), gas [Gas] and electricity are exempted from the
14-14 taxes imposed by this chapter [except] when sold for:
14-15 (1) residential use;
14-16 (2) use in powering equipment exempt under Section
14-17 151.318 by a person processing tangible personal property for sale
14-18 as tangible personal property, other than preparation or storage of
14-19 food for immediate consumption;
14-20 (3) use in lighting, cooling, and heating in the
14-21 manufacturing area during the actual manufacturing or processing of
14-22 tangible personal property for sale as tangible personal property,
14-23 other than preparation or storage of food for immediate
14-24 consumption;
14-25 (4) use directly in exploring for, producing, or
14-26 transporting, a material extracted from the earth;
15-1 (5) use in agriculture, including dairy or poultry
15-2 operations and pumping for farm or ranch irrigation;
15-3 (6) use directly in electrical processes, such as
15-4 electroplating, electrolysis, and cathodic protection;
15-5 (7) use directly in the off-wing processing, overhaul,
15-6 or repair of a jet turbine engine or its parts for a certificated
15-7 or licensed carrier of persons or property;
15-8 (8) use directly in providing, under contracts with or
15-9 on behalf of the United States government or foreign governments,
15-10 defense or national security-related electronics, classified
15-11 intelligence data processing and handling systems, or
15-12 defense-related platform modifications or upgrades; or
15-13 (9) a direct or indirect use, consumption, or loss of
15-14 electricity by an electric utility engaged in the purchase of
15-15 electricity for resale [commercial use].
15-16 (b) The sale, production, distribution, lease, or rental of,
15-17 and the use, storage, or other consumption in this state of, gas
15-18 and electricity sold for the uses listed in Subsection (a), [except
15-19 when sold for residential or commercial use,] are exempted from the
15-20 taxes imposed by a municipality [city] under Chapter 321 except
15-21 [the Local Sales and Use Tax Act, unless sales for residential use
15-22 are further exempted by the city] as provided by Section 321.105
15-23 [the Local Sales and Use Tax Act].
15-24 (c) In this section, "residential [:]
15-25 [(1) "Residential] use" means use:
15-26 (1) [(A)] in a family dwelling or in a multifamily
16-1 apartment or housing complex or building or in a part of a building
16-2 occupied as a home or residence when the use is by the owner of the
16-3 dwelling, apartment, complex, or building or part of the building
16-4 occupied; or
16-5 (2) [(B)] in a dwelling, apartment, house, or building
16-6 or part of a building occupied as a home or residence when the use
16-7 is by a tenant who occupies the dwelling, apartment, house, or
16-8 building or part of a building under a contract for an express
16-9 initial term for longer than 29 consecutive days.
16-10 (d) To qualify for the exemptions in Subsections (a)(2)-(8),
16-11 the gas or electricity must be sold to the person using the gas or
16-12 electricity in the exempt manner. For purposes of this subsection,
16-13 the use of gas or electricity in an exempt manner by an independent
16-14 contractor engaged by the purchaser of the gas or electricity to
16-15 perform one or more of the exempt activities identified in
16-16 Subsections (a)(2)-(8) is considered use by the purchaser of the
16-17 gas or electricity.
16-18 (e) Natural gas or electricity used during a regular monthly
16-19 billing period for both exempt and taxable purposes under a single
16-20 meter is totally exempt or taxable based on the predominant use of
16-21 the natural gas or electricity measured by that meter. The
16-22 comptroller may prescribe by rule the procedures by which a
16-23 purchaser must establish the predominant use of the natural gas or
16-24 electricity.
16-25 [(2) "Commercial use" means use by a person engaged in
16-26 selling, warehousing, or distributing a commodity or a professional
17-1 or personal service, but does not include:]
17-2 [(A) use by a person engaged in:]
17-3 [(i) processing tangible personal property
17-4 for sale as tangible personal property, other than preparation or
17-5 storage of food for immediate consumption;]
17-6 [(ii) exploring for, producing, or
17-7 transporting, a material extracted from the earth;]
17-8 [(iii) agriculture, including dairy or
17-9 poultry operations and pumping for farm or ranch irrigation;]
17-10 [(iv) electrical processes such as
17-11 electroplating, electrolysis, and cathodic protection;]
17-12 [(v) the off-wing processing, overhaul, or
17-13 repair of a jet turbine engine or its parts for a certificated or
17-14 licensed carrier of persons or property; or]
17-15 [(vi) providing, under contracts with or
17-16 on behalf of the United States government or foreign governments,
17-17 defense or national security-related electronics, classified
17-18 intelligence data processing and handling systems, or
17-19 defense-related platform modifications or upgrades; or]
17-20 [(B) a direct or indirect use, consumption, or
17-21 loss of electricity by an electric utility engaged in the purchase
17-22 of electricity for resale.]
17-23 SECTION 2.19. Section 151.318, Tax Code, is amended by
17-24 amending Subsections (a), (c), (o), (q), and (s), and adding
17-25 Subsections (f) and (t) to read as follows:
17-26 (a) The following items are exempted from the taxes imposed
18-1 by this chapter if sold, leased, or rented to, or stored, used, or
18-2 consumed by a manufacturer:
18-3 (1) tangible personal property that will become an
18-4 ingredient or component part of tangible personal property
18-5 manufactured, processed, or fabricated for ultimate sale;
18-6 (2) tangible personal property directly used or
18-7 consumed in or during the actual manufacturing, processing, or
18-8 fabrication of tangible personal property for ultimate sale if the
18-9 use or consumption of the property is necessary or essential to the
18-10 manufacturing, processing, or fabrication operation and directly
18-11 makes or causes a chemical or physical change to:
18-12 (A) the product being manufactured, processed,
18-13 or fabricated for ultimate sale; or
18-14 (B) any intermediate or preliminary product that
18-15 will become an ingredient or component part of the product being
18-16 manufactured, processed, or fabricated for ultimate sale;
18-17 (3) services performed directly on the product being
18-18 manufactured prior to its distribution for sale and for the purpose
18-19 of making the product more marketable;
18-20 (4) actuators, steam production equipment and its
18-21 fuel, in-process flow through tanks, cooling towers, generators,
18-22 heat exchangers, transformers and the switches, breakers, capacitor
18-23 banks, regulators, relays, reclosers, fuses, interruptors,
18-24 reactors, arrestors, resistors, insulators, instrument
18-25 transformers, and telemetry units that are related to the
18-26 transformers, electronic control room equipment, computerized
19-1 control units, pumps, compressors, and hydraulic units, that are
19-2 used to power, supply, support, or control equipment that qualifies
19-3 for exemption under Subdivision (2) or (5) or to generate
19-4 electricity, chilled water, or steam for ultimate sale;
19-5 transformers located at an electric generating facility that
19-6 increase the voltage of electricity generated for ultimate sale,
19-7 the electrical cable that carries the electricity from the electric
19-8 generating equipment to the step-up transformers, and the switches,
19-9 breakers, capacitor banks, regulators, relays, reclosers, fuses,
19-10 interruptors, reactors, arrestors, resistors, insulators,
19-11 instrument transformers, and telemetry units that are related to
19-12 the step-up transformers; and transformers that decrease the
19-13 voltage of electricity generated for ultimate sale and the
19-14 switches, breakers, capacitor banks, regulators, relays, reclosers,
19-15 fuses, interruptors, reactors, arrestors, resistors, insulators,
19-16 instrument transformers, and telemetry units that are related to
19-17 the step-down transformers; [and]
19-18 (5) tangible personal property [machinery, equipment,
19-19 and replacement parts or accessories] used or consumed in the
19-20 actual manufacturing, processing, or fabrication of tangible
19-21 personal property for ultimate sale if the [their] use or
19-22 consumption of the property is necessary and essential to a
19-23 pollution control process;
19-24 (6) lubricants, chemicals, chemical compounds, gases,
19-25 or liquids that are used or consumed during the actual
19-26 manufacturing, processing, or fabrication of tangible personal
20-1 property for ultimate sale if their use or consumption is necessary
20-2 and essential to prevent the decline, failure, lapse, or
20-3 deterioration of equipment exempted by this section;
20-4 (7) gases used on the premises of a manufacturing
20-5 plant to prevent contamination of raw material or product, or to
20-6 prevent a fire, explosion, or other hazardous or environmentally
20-7 damaging situation at any stage in the manufacturing process or in
20-8 loading or storage of the product or raw material on premises;
20-9 (8) tangible personal property used or consumed during
20-10 the actual manufacturing, processing, or fabrication of tangible
20-11 personal property for ultimate sale if the use or consumption of
20-12 the property is necessary and essential to a quality control
20-13 process;
20-14 (9) safety apparel or work clothing that is used
20-15 during the actual manufacturing, processing, or fabrication of
20-16 tangible personal property for ultimate sale if:
20-17 (A) the manufacturing process would not be
20-18 possible without the use of the apparel or clothing; and
20-19 (B) the apparel or clothing is not resold to the
20-20 employee;
20-21 (10) tangible personal property used or consumed in
20-22 the actual manufacturing, processing, or fabrication of tangible
20-23 personal property for ultimate sale if the use or consumption of
20-24 the property is necessary and essential to comply with federal,
20-25 state, or local laws or rules that establish requirements related
20-26 to public health; and
21-1 (11) tangible personal property specifically installed
21-2 to:
21-3 (A) reduce water use and wastewater flow volumes
21-4 from the manufacturing, processing, fabrication, or repair
21-5 operation;
21-6 (B) reuse and recycle wastewater streams
21-7 generated within the manufacturing, processing, fabrication, or
21-8 repair operation; or
21-9 (C) treat wastewater from another industrial or
21-10 municipal source for the purpose of replacing existing freshwater
21-11 sources in the manufacturing, processing, fabrication, or repair
21-12 operation.
21-13 (c) The exemption does not include:
21-14 (1) intraplant transportation equipment, including
21-15 intraplant transportation equipment used to move a product or raw
21-16 material in connection with the manufacturing process and
21-17 specifically including all piping and conveyor systems, provided
21-18 that the following remain eligible for the exemption:
21-19 (A) piping or conveyor systems that are [is] a
21-20 component part of a single item of manufacturing equipment or
21-21 pollution control equipment eligible for the exemption under
21-22 Subsection (a)(2), (a)(4), or (a)(5);
21-23 (B) piping through which the product or an
21-24 intermediate or preliminary product that will become an ingredient
21-25 or component part of the product is recycled or circulated in a
21-26 loop between the single item of manufacturing equipment and the
22-1 ancillary equipment that supports only that single item of
22-2 manufacturing equipment if the single item of manufacturing
22-3 equipment and the ancillary equipment operate together to perform a
22-4 specific step in the manufacturing process; and
22-5 (C) piping through which the product or an
22-6 intermediate or preliminary product that will become an ingredient
22-7 or component part of the product is recycled back to another single
22-8 item of manufacturing equipment and its ancillary equipment in the
22-9 same manufacturing process [remains eligible for the exemption];
22-10 (2) [maintenance or janitorial supplies or equipment
22-11 or other machinery, equipment, materials, or supplies that are used
22-12 incidentally in a manufacturing, processing, or fabrication
22-13 operation;]
22-14 [(3)] hand tools;
22-15 (3) maintenance supplies not otherwise exempted under
22-16 this section, maintenance equipment, janitorial supplies or
22-17 equipment, [(4)] office equipment or supplies, equipment or
22-18 supplies used in sales or distribution activities, research or
22-19 development of new products, or transportation activities[, or
22-20 other tangible personal property not used in an actual
22-21 manufacturing, processing, or fabrication operation]; [or]
22-22 (4) [(5)] machinery and equipment or supplies to the
22-23 extent not otherwise exempted under this section used to maintain
22-24 or store tangible personal property; or
22-25 (5) tangible personal property used in the
22-26 transmission or distribution of electricity, including
23-1 transformers, cable, switches, breakers, capacitor banks,
23-2 regulators, relays, reclosers, fuses, interruptors, reactors,
23-3 arrestors, resistors, insulators, instrument transformers, and
23-4 telemetry units not otherwise exempted under this section, and
23-5 lines, conduit, towers, and poles.
23-6 (f) For purposes of Subsection (c)(1), piping through which
23-7 material is transported forward from one single item of
23-8 manufacturing equipment and its ancillary support equipment to
23-9 another single item of manufacturing equipment and its ancillary
23-10 support equipment is not considered a component part of a single
23-11 item of manufacturing equipment and is not exempt. An integrated
23-12 group of manufacturing and processing machines and ancillary
23-13 equipment that operate together to create or produce the product or
23-14 an intermediate or preliminary product that will become an
23-15 ingredient or component part of the product is not a single item of
23-16 manufacturing equipment.
23-17 (o) The production of a publication for the dissemination of
23-18 news of a general character and of a general interest that is
23-19 printed on newsprint and distributed to the general public free of
23-20 charge at a daily, weekly, or other short interval is considered
23-21 "manufacturing" for purposes of [Subsections (d)-(m) of] this
23-22 section.
23-23 (q) For purposes of Subsection (b), "semiconductor
23-24 fabrication cleanrooms and equipment" means all tangible personal
23-25 property, without regard to whether the property is affixed to or
23-26 incorporated into realty, used in connection with the
24-1 manufacturing, processing, or fabrication in a cleanroom
24-2 environment of a semiconductor product, without regard to whether
24-3 the property is actually contained in the cleanroom environment.
24-4 The term includes integrated systems, fixtures, and piping, all
24-5 property necessary or adapted to reduce contamination or to control
24-6 airflow, temperature, humidity, chemical purity, or other
24-7 environmental conditions or manufacturing tolerances, and
24-8 production equipment and machinery. The term does not include the
24-9 building or a permanent, nonremovable component of the building,
24-10 that houses the cleanroom environment. The term includes moveable
24-11 cleanroom partitions and cleanroom lighting. "Semiconductor
24-12 fabrication cleanrooms and equipment" are not "intraplant
24-13 ["interplant] transportation equipment" [or "used incidentally in a
24-14 manufacturing, processing, or fabrication operation"] as that term
24-15 is [those terms are] used in Subsection [Subsections] (c)(1) [and
24-16 (c)(2)].
24-17 (s) The following do not apply to the semiconductor
24-18 fabrication cleanrooms and equipment in Subsection (q):
24-19 (1) limitations in Subsection (a)(2) that refer to
24-20 tangible personal property directly causing chemical and physical
24-21 changes to the product being manufactured, processed, or fabricated
24-22 for ultimate sale;
24-23 (2) Subsection (c)(1); and
24-24 (3) Subsection (c)(4)[(5)].
24-25 (t) In addition to the other items exempted under this
24-26 section, pre-press machinery, equipment, and supplies, including
25-1 computers, cameras, film, film developing chemicals, veloxes,
25-2 plate-making machinery, plate metal, litho negatives, color
25-3 separation negatives, proofs of color negatives, production art
25-4 work, and typesetting or composition proofs, that are necessary and
25-5 essential to and used in connection with the printing process are
25-6 exempted from the tax imposed by this chapter if they are purchased
25-7 by a person engaged in:
25-8 (1) printing or imprinting tangible personal property
25-9 for sale; or
25-10 (2) producing a publication for the dissemination of
25-11 news of a general character and of a general interest that is
25-12 printed on newsprint and distributed to the general public free of
25-13 charge at a daily, weekly, or other short interval.
25-14 SECTION 2.20. Subchapter H, Chapter 151, Tax Code, is
25-15 amended by adding Section 151.3185 to read as follows:
25-16 Sec. 151.3185. PROPERTY USED IN THE PRODUCTION OF MOTION
25-17 PICTURES OR VIDEO OR AUDIO RECORDINGS AND BROADCASTS. (a) The
25-18 sale, lease, or rental or storage, use, or other consumption of the
25-19 following items are exempted from the taxes imposed by this
25-20 chapter:
25-21 (1) tangible personal property that will become an
25-22 ingredient or component part of:
25-23 (A) a motion picture or video or audio
25-24 recording, a copy of which is sold or offered for ultimate sale,
25-25 licensed, distributed, broadcast, or otherwise exhibited; or
25-26 (B) a broadcast by a producer of cable programs
26-1 or by a radio or television station licensed by the Federal
26-2 Communications Commission;
26-3 (2) tangible personal property that is necessary or
26-4 essential to and used or consumed in or during:
26-5 (A) the production of a motion picture or video
26-6 or audio recording, a copy of which is sold or offered for ultimate
26-7 sale, licensed, distributed, broadcast, or otherwise exhibited; or
26-8 (B) the production of a broadcast by or for a
26-9 cable program producer or by or for a radio or television station
26-10 licensed by the Federal Communications Commission; and
26-11 (3) except as provided by Subsection (c), services
26-12 that are necessary and essential to and used directly in a
26-13 production described by Subdivision (2)(A) or (B).
26-14 (b) The exemption includes:
26-15 (1) cameras, film, and film developing chemicals that
26-16 are necessary and essential to and used or consumed in a production
26-17 described by Subsection (a)(2)(A) or (B);
26-18 (2) lights, props, sets, teleprompters, microphones,
26-19 digital equipment, special effects equipment and supplies, and
26-20 other equipment that is necessary and essential to and used or
26-21 consumed directly in a production described by Subsection (a)(2)(A)
26-22 or (B); and
26-23 (3) audio or video routing switchers located in a
26-24 studio that are necessary and essential to and used or consumed
26-25 directly in a production described by Subsection (a)(2)(A) or (B).
26-26 (c) The exemption does not include:
27-1 (1) office equipment or supplies;
27-2 (2) maintenance or janitorial equipment or supplies;
27-3 (3) machinery, equipment, or supplies used in sales,
27-4 transmission, or transportation activities;
27-5 (4) machinery, equipment, or supplies used in
27-6 distribution activities, unless otherwise exempted by this section;
27-7 (5) taxable items that are used incidentally in a
27-8 production described by Subsection (a)(2)(A) or (B); or
27-9 (6) the following taxable items, regardless of whether
27-10 they are used incidentally in a production described by Subsection
27-11 (a)(2)(A) or (B):
27-12 (A) telecommunications equipment and services;
27-13 (B) transmission equipment;
27-14 (C) security services;
27-15 (D) motor vehicle parking services; and
27-16 (E) food ready for immediate consumption.
27-17 (d) A production described by Subsection (a)(2)(A) or (B)
27-18 does not include a production for broadcast that is not intended to
27-19 be broadcast to either the general public or to cable television
27-20 service subscribers or paying customers.
27-21 SECTION 2.21. Section 151.321(a), Tax Code, is amended to
27-22 read as follows:
27-23 (a) A taxable item sold by a qualified student organization
27-24 and for which the sales price is $5,000 or less, is exempted from
27-25 the taxes imposed by Subchapter C, except that a taxable item
27-26 manufactured by or donated to the organization is exempt from the
28-1 taxes imposed by Subchapter C regardless of sales price unless sold
28-2 to the donor, if the student organization:
28-3 (1) sells the item at a sale that may last for one day
28-4 only and the primary purpose of which is to raise funds for the
28-5 organization; and
28-6 (2) holds not more than one sale described by
28-7 Subdivision (1) each month for which an exemption is claimed for an
28-8 item sold.
28-9 SECTION 2.22. Section 151.350(d), Tax Code, is amended to
28-10 read as follows:
28-11 (d) In this section, "restore" means:
28-12 (1) launder, [or] clean, repair, treat, or apply
28-13 protective chemicals to an item, to the extent the service is a
28-14 personal service as defined in Section 151.0045; and
28-15 (2) repair, restore, or remodel, to the extent the
28-16 service is:
28-17 (A) a real property repair or remodeling service
28-18 as defined in Section 151.0047; or
28-19 (B) defined as a taxable service in Section
28-20 151.0101(a)(5) [151.0101(5)].
28-21 SECTION 2.23. Subchapter H, Chapter 151, Tax Code, is
28-22 amended by adding Section 151.354 to read as follows:
28-23 Sec. 151.354. SERVICES BY EMPLOYEES OF PROPERTY MANAGEMENT
28-24 COMPANIES. (a) There are exempted from the taxes imposed by this
28-25 chapter services performed by an employee of a property management
28-26 company if:
29-1 (1) the employee is permanently assigned to one rental
29-2 property by the property management company;
29-3 (2) the property management company is reimbursed on a
29-4 dollar-for-dollar basis for the services provided; and
29-5 (3) the employee remains assigned to that property
29-6 while employed by successive owners or management companies.
29-7 (b) This exemption does not apply to services performed by
29-8 an employee for properties other than the one to which the employee
29-9 is permanently assigned.
29-10 (c) For purposes of this section, a person is an employee of
29-11 a property management company if either the property management
29-12 company or an affiliate of the property management company employs
29-13 the person.
29-14 (d) The property management company must:
29-15 (1) be contractually obligated to the property owner
29-16 to exercise control over the activities of the employee providing
29-17 the service; and
29-18 (2) manage and direct the employee's day-to-day
29-19 activities.
29-20 (e) The property management company or the affiliate must
29-21 pay tax on the taxable items purchased and provided to employees
29-22 providing services on managed property.
29-23 (f) In this section, "property management company" means a
29-24 person:
29-25 (1) who, for consideration, operates and manages all
29-26 the activities at a property held by the owner for purposes of
30-1 rental, including an office building, mall, or other retail or
30-2 office complex, an apartment complex, a duplex, or a home; and
30-3 (2) whose responsibilities include securing tenants,
30-4 hiring, and supervising employees for operation or upkeep of the
30-5 property, receiving and applying revenues, and incurring and paying
30-6 expenses derived from the operation of the property as directed by
30-7 the owner.
30-8 (g) In this section, a corporation, limited liability
30-9 company, partnership, trust, or estate is an affiliate of the
30-10 property management company if an 80 percent ownership interest in
30-11 the property management company or the corporation, limited
30-12 liability company, partnership, trust, or estate is held by the
30-13 other, or if a third person has an 80 percent ownership interest
30-14 either directly or indirectly in both the property management
30-15 company and the corporation, limited liability company,
30-16 partnership, trust, or estate.
30-17 SECTION 2.24. Section 151.426, Tax Code, is amended by
30-18 amending Subsection (c) and adding Subsections (e), (f), (g), (h),
30-19 (i), and (j) to read as follows:
30-20 (c) Subject to Subsection (e), a [A] retailer or any person
30-21 who extends credit to a purchaser under a retailer's private label
30-22 credit agreement, or an assignee or affiliate of either, is
30-23 entitled to credit or reimbursement for taxes paid on the portion
30-24 of:
30-25 (1) an account determined to be worthless and actually
30-26 charged off for federal income tax purposes; or
31-1 (2) the remaining unpaid sales price of a taxable item
31-2 when the item is repossessed under a conditional sales contract.
31-3 (e) A person is entitled to a credit or reimbursement
31-4 provided by Subsection (c) only if:
31-5 (1) the retailer:
31-6 (A) has a valid sales or use tax permit; and
31-7 (B) remits the tax for which the credit or
31-8 reimbursement is sought;
31-9 (2) all payments on an account are prorated between
31-10 taxable and nontaxable charges; and
31-11 (3) the retailer or person claiming the credit or
31-12 reimbursement provides detailed records outlining:
31-13 (A) the amount the purchaser contracted to pay;
31-14 (B) taxable and nontaxable charges;
31-15 (C) the tax collected and remitted;
31-16 (D) the unpaid portion of the sales price
31-17 assigned; and
31-18 (E) the taxpayer number of the seller who
31-19 collected and remitted the tax.
31-20 (f) A person whose volume and character of uncollectible
31-21 accounts warrants an alternative method of substantiating the
31-22 reimbursement or credit may:
31-23 (1) maintain records other than the records specified
31-24 in Subsection (e) if:
31-25 (A) the records fairly and equitably apportion
31-26 taxable and nontaxable elements of a bad debt and compute the
32-1 amount of sales tax imposed and remitted with respect to the
32-2 taxable charges remaining unpaid on the debt; and
32-3 (B) the comptroller approves the procedures
32-4 used; or
32-5 (2) implement a system to report its future tax
32-6 responsibilities based on a historical percentage calculated from a
32-7 sample of transactions if:
32-8 (A) the system utilizes records provided by the
32-9 person claiming the credit or reimbursement; and
32-10 (B) the comptroller approves the procedures
32-11 used.
32-12 (g) The comptroller may revoke the authorization to report
32-13 under Subsection (f)(2) if the comptroller determines that the
32-14 percentage being used is no longer representative because of:
32-15 (1) a change in law, including a change in the
32-16 interpretation of an existing law or rule; or
32-17 (2) a change in the taxpayer's business operations.
32-18 (h) A person claiming a credit or reimbursement under this
32-19 section shall remit tax on any payments received on an account that
32-20 has been written off and claimed as a bad debt.
32-21 (i) A person who is not a retailer may claim a credit or
32-22 reimbursement authorized by Subsection (c) only for taxes imposed
32-23 by Section 151.051 or 151.101.
32-24 (j) For purposes of this section, "affiliate" means any
32-25 entity or entities that would be classified as a member of an
32-26 affiliated group under 26 U.S.C. Section 1504.
33-1 SECTION 2.25. Sections 151.429(d) and (g), Tax Code, are
33-2 amended to read as follows:
33-3 (d) To receive a refund under this section, an enterprise
33-4 project must apply to the comptroller for the refund. The Texas
33-5 Department of Economic Development [department of commerce] shall
33-6 provide the comptroller with the assistance that the comptroller
33-7 requires in administering this section.
33-8 (g) The refund provided by this section is conditioned on
33-9 the enterprise project maintaining at least the same level of
33-10 employment of qualified employees as existed at the time it
33-11 qualified for a refund for a period of three years from that date.
33-12 The Texas Department of Economic Development [Commerce] shall
33-13 annually certify to the comptroller and the Legislative Budget
33-14 Board whether that level of employment of qualified employees has
33-15 been maintained. On the Texas Department of Economic Development
33-16 [Commerce] certifying that such a level has not been maintained,
33-17 the comptroller shall assess that portion of the refund
33-18 attributable to any such decrease in employment, including penalty
33-19 and interest from the date of the refund.
33-20 SECTION 2.26. Section 151.429(e)(1), Tax Code, is amended to
33-21 read as follows:
33-22 (1) "Enterprise project" means a person designated by
33-23 the Texas Department of Economic Development [Commerce] as an
33-24 enterprise project under Chapter 2303, Government Code.
33-25 SECTION 2.27. Sections 151.4291(d) and (g), Tax Code, are
33-26 amended to read as follows:
34-1 (d) To receive a refund under this section, a defense
34-2 readjustment project must apply to the comptroller for the refund.
34-3 The Texas Department of Economic Development [Commerce] shall
34-4 provide the comptroller with the assistance that the comptroller
34-5 requires in administering this section.
34-6 (g) The refund provided by this section is conditioned on
34-7 the defense readjustment project maintaining at least the same
34-8 level of employment of qualified employees as existed at the time
34-9 it qualified for a refund for a period of three years from that
34-10 date. The Texas Department of Economic Development [Commerce]
34-11 shall annually certify to the comptroller and the Legislative
34-12 Budget Board whether that level of employment of qualified
34-13 employees has been maintained. On the Texas Department of Economic
34-14 Development [Commerce] certifying that such a level has not been
34-15 maintained, the comptroller shall assess that portion of the refund
34-16 attributable to any such decrease in employment, including penalty
34-17 and interest from the date of the refund.
34-18 SECTION 2.28. Section 151.4291(e)(1), Tax Code, is amended
34-19 to read as follows:
34-20 (1) "Defense readjustment project" means a person
34-21 designated by the Texas Department of Economic Development
34-22 [Commerce] as a defense readjustment project under Chapter 2310,
34-23 Government Code.
34-24 SECTION 2.29. Section 151.431(a), Tax Code, is amended to
34-25 read as follows:
34-26 (a) A qualified business operating in the enterprise zone's
35-1 jurisdiction for at least three consecutive years may apply for and
35-2 be granted a onetime refund of sales and use tax paid by the
35-3 qualified business after certification of the qualified business as
35-4 provided by Subsection (b) of this section to a vendor or directly
35-5 to the state for the purchase of equipment or machinery sold to the
35-6 business for use in an enterprise zone if the governing body or
35-7 bodies certify to the Texas Department of Economic Development
35-8 [Commerce] that the business is retaining 10 or more jobs held by
35-9 qualified employees during the year. For the purposes of this
35-10 subsection "job" means an existing employment position of a
35-11 qualified business that has provided employment to a qualified
35-12 employee of at least 1,820 hours annually.
35-13 SECTION 2.30. Section 152.002, Tax Code, is amended by
35-14 adding Subsection (d) to read as follows:
35-15 (d) A person who holds a lessor license under the Texas
35-16 Motor Vehicle Commission Code (Article 4413(36), Vernon's Texas
35-17 Civil Statutes) or is specifically not required to obtain a lessor
35-18 license under Section 4.01(a) of that Act may deduct the fair
35-19 market value of a replaced motor vehicle that has been leased for
35-20 longer than 180 days and is titled to another person if:
35-21 (1) either person:
35-22 (A) holds a beneficial ownership interest in the
35-23 other person of at least 80 percent; or
35-24 (B) acquires all of its vehicles exclusively
35-25 from franchised dealers whose franchisor shares common ownership
35-26 with the other person; and
36-1 (2) the replaced motor vehicle is offered for sale.
36-2 SECTION 2.31. Section 152.041, Tax Code, is amended by
36-3 adding Subsection (e) to read as follows:
36-4 (e) If a motor vehicle title applicant has paid the tax to
36-5 the seller who is required by this chapter to collect the tax and
36-6 the seller has failed to remit the tax to the county tax
36-7 assessor-collector, the tax assessor-collector may accept
36-8 application for title to the motor vehicle without the payment of
36-9 additional tax by the applicant. Before title to the motor vehicle
36-10 may be issued under these circumstances, the motor vehicle title
36-11 applicant must present satisfactory documentation to the tax
36-12 assessor-collector that the tax was paid. The county tax
36-13 assessor-collector shall notify the comptroller in writing of the
36-14 seller's failure to remit the tax. The notice must:
36-15 (1) be made before the 31st day after the date the
36-16 application for title is accepted;
36-17 (2) contain the name and address of the seller; and
36-18 (3) include any documentation of the payment of the
36-19 tax provided to the county tax assessor-collector by the motor
36-20 vehicle title applicant.
36-21 SECTION 2.32. Sections 153.117(a), (b), (d), and (h), Tax
36-22 Code, are amended to read as follows:
36-23 (a) A distributor shall keep a record showing the number of
36-24 gallons of:
36-25 (1) all gasoline inventories on hand at the first of
36-26 each month;
37-1 (2) all gasoline refined, compounded, or blended;
37-2 (3) all gasoline purchased or received, showing the
37-3 name of the seller and date of each purchase or receipt;
37-4 (4) all gasoline sold, distributed, or used, showing
37-5 the name of the purchaser and the date of the sale or use; and
37-6 (5) all gasoline lost by fire, theft, or [other]
37-7 accident.
37-8 (b) A dealer shall keep a record showing the number of
37-9 gallons of:
37-10 (1) gasoline inventories on hand at the first of each
37-11 month;
37-12 (2) all gasoline purchased or received, showing the
37-13 name of the seller and the date of each purchase or receipt;
37-14 (3) all gasoline sold or used, showing the date of the
37-15 sale or use; and
37-16 (4) all gasoline lost by fire, theft, or [other]
37-17 accident.
37-18 (d) An aviation fuel dealer shall keep a record showing the
37-19 number of gallons of:
37-20 (1) all gasoline inventories on hand at the first of
37-21 each month;
37-22 (2) all gasoline purchased or received, showing the
37-23 name of the seller and date of each purchase or receipt;
37-24 (3) all gasoline sold or used in aircraft or aircraft
37-25 servicing equipment; and
37-26 (4) all gasoline lost by fire, theft, or [other]
38-1 accident.
38-2 (h) A gasoline jobber shall keep a record showing the number
38-3 of gallons of:
38-4 (1) all gasoline inventories on hand at the first of
38-5 each month;
38-6 (2) all gasoline purchased or received, showing the
38-7 name of the seller and date of each purchase or receipt;
38-8 (3) all gasoline sold, distributed, or used, showing
38-9 the name of the purchaser and the date of the sale or use; and
38-10 (4) all gasoline lost by fire, theft, or [other]
38-11 accident.
38-12 SECTION 2.33. Sections 153.119(a) and (e), Tax Code, are
38-13 amended to read as follows:
38-14 (a) A person who exports, sells to the federal government,
38-15 to a public school district in this state, or to a commercial
38-16 transportation company for exclusive use in providing public school
38-17 transportation services to a school district under Section 34.008,
38-18 Education Code, without having added the amount of the tax imposed
38-19 by this chapter to his selling price, loses by fire, theft, or
38-20 [other] accident, or uses gasoline for the purpose of operating or
38-21 propelling a motorboat, tractor used for agricultural purposes, or
38-22 stationary engine, or for another purpose except in a vehicle
38-23 operated or intended to be operated on the public highways of this
38-24 state, and who has paid the tax imposed on gasoline by this chapter
38-25 either directly or indirectly is, when the person has complied with
38-26 the invoice and filing provisions of this section and the rules of
39-1 the comptroller, entitled to reimbursement of the tax paid by him,
39-2 less a filing fee and any amount allowed distributors[, wholesalers
39-3 or jobbers, dealers, or others] under Section 153.105(e)
39-4 [153.105(c)] of this code. A public school district that has paid
39-5 the tax imposed under this chapter on gasoline used by the district
39-6 or a commercial transportation company that has paid the tax
39-7 imposed under this chapter on gasoline used by the company
39-8 exclusively to provide public school transportation services to a
39-9 school district under Section 34.008, Education Code, is entitled
39-10 to reimbursement of the amount of the tax paid in the same manner
39-11 and subject to the same procedures as other exempted users.
39-12 (e) A person who exports or loses by fire, theft, or [other]
39-13 accident 100 or more gallons of gasoline on which the tax has been
39-14 paid, or sells gasoline in any quantity to the United States
39-15 government for the exclusive use of that government on which the
39-16 tax has been paid, may file a claim for a refund of the net tax
39-17 paid to the state in the manner provided by this chapter or as the
39-18 comptroller may direct.
39-19 SECTION 2.34. Section 153.121(a), Tax Code, is amended to
39-20 read as follows:
39-21 (a) Except as provided by this section, a claim for a refund
39-22 must be filed with the comptroller within one year after the first
39-23 day of the calendar month following the purchase, use, delivery,
39-24 export, or loss by fire, theft, or [other] accident of gasoline,
39-25 whichever period expires latest.
39-26 SECTION 2.35. Section 153.206, Tax Code, is amended by
40-1 adding Subsection (j) to read as follows:
40-2 (j) In each subsequent sale of diesel fuel on which the tax
40-3 has been collected, the amount of the tax shall be added to the
40-4 selling price so that the tax is paid ultimately by the person
40-5 using or consuming the diesel fuel for the purpose of propelling a
40-6 vehicle on the public highways of this state.
40-7 SECTION 2.36. Sections 153.219(a), (b), (c), (d), and (i),
40-8 Tax Code, are amended to read as follows:
40-9 (a) A supplier shall keep a record showing the number of
40-10 gallons of:
40-11 (1) all diesel fuel inventories on hand at the first
40-12 of each month;
40-13 (2) all diesel fuel refined, compounded, or blended;
40-14 (3) all diesel fuel purchased or received, showing the
40-15 name of the seller, and the date of each purchase or receipt;
40-16 (4) all diesel fuel sold, distributed, or used showing
40-17 the name of the purchaser and the date of sale, distribution, or
40-18 use; and
40-19 (5) all diesel fuel lost by fire, theft, or [other]
40-20 accident.
40-21 (b) A dealer shall keep a record showing the number of
40-22 gallons of:
40-23 (1) all diesel fuel inventories on hand at the first
40-24 of each month;
40-25 (2) all diesel fuel purchased or received, showing the
40-26 name of the seller, the date of each purchase or receipt;
41-1 (3) all diesel fuel sold, distributed, or used; and
41-2 (4) all diesel fuel lost by fire, theft, or [other]
41-3 accident.
41-4 (c) A bonded user or other user with nonhighway equipment
41-5 uses who files a claim for a refund shall keep a record showing the
41-6 number of gallons of:
41-7 (1) inventories of all diesel fuel on hand at the
41-8 first of each month;
41-9 (2) all diesel fuel purchased or received, showing the
41-10 name of the seller and the date of each purchase;
41-11 (3) all diesel fuel deliveries into the fuel supply
41-12 tanks of motor vehicles;
41-13 (4) diesel fuel used for other purposes, showing the
41-14 purpose for which used; and
41-15 (5) all diesel fuel lost by fire, theft, or [other]
41-16 accident.
41-17 (d) An aviation fuel dealer shall keep a record showing the
41-18 number of gallons of:
41-19 (1) all diesel fuel inventories on hand at the first
41-20 of each month;
41-21 (2) all diesel fuel purchased or received, showing the
41-22 name of the seller and the date of each purchase or receipt;
41-23 (3) all diesel fuel sold, distributed, or used in
41-24 aircraft or aircraft servicing equipment; and
41-25 (4) diesel fuel lost by fire, theft, or [other]
41-26 accident.
42-1 (i) A diesel fuel jobber shall keep a record showing the
42-2 number of gallons of:
42-3 (1) all diesel fuel inventories on hand at the first
42-4 of each month;
42-5 (2) all diesel fuel purchased or received, showing the
42-6 name of the seller and date of each purchase or receipt;
42-7 (3) all diesel fuel sold, distributed, or used,
42-8 showing the name of the purchaser and the date of the sale or use;
42-9 and
42-10 (4) all diesel fuel lost by fire, theft, or [other]
42-11 accident.
42-12 SECTION 2.37. Section 153.222(e), Tax Code, is amended to
42-13 read as follows:
42-14 (e) A person who exports or loses by fire, theft, or [other]
42-15 accident 100 or more gallons of diesel fuel on which the tax has
42-16 been paid, or who sells diesel fuel in any quantity to the United
42-17 States for its exclusive use on which the tax has been paid, may
42-18 file a claim for a refund of the net tax paid to the state as the
42-19 comptroller may direct.
42-20 SECTION 2.38. Section 153.224(a), Tax Code, is amended to
42-21 read as follows:
42-22 (a) Except as provided by this section, a claim for a refund
42-23 must be filed with the comptroller within one year after the first
42-24 day of the calendar month following the purchase, use, delivery,
42-25 export, or loss by fire, theft, or [other] accident of diesel fuel,
42-26 whichever period expires latest.
43-1 SECTION 2.39. Sections 154.114(c) and (g), Tax Code, are
43-2 amended to read as follows:
43-3 (c) The comptroller shall deliver [mail] the written notice
43-4 by personal service or by [certified] mail[, return receipt
43-5 requested,] to the permit holder's mailing address as it appears on
43-6 the comptroller's records. Service by mail is complete when the
43-7 notice is deposited with [received, as evidenced by return receipt
43-8 from] the U.S. Postal Service.
43-9 (g) If the comptroller suspends or revokes a permit, the
43-10 comptroller shall provide written notice of the suspension or
43-11 revocation, within a reasonable time, to each distributor and
43-12 wholesaler permit holder in the state. A distributor or wholesaler
43-13 permit holder violates Section 154.1015(a) by selling or
43-14 distributing cigarettes to a person whose permit has been suspended
43-15 or revoked only after the distributor or wholesaler permit holder
43-16 receives written notice of the suspension or revocation from the
43-17 comptroller.
43-18 SECTION 2.40. Section 154.210(a), Tax Code, is amended to
43-19 read as follows:
43-20 (a) A distributor shall deliver to the comptroller, on or
43-21 before the last [15th] day of each month, a report for the
43-22 preceding month.
43-23 SECTION 2.41. Section 154.308(b), Tax Code, is amended to
43-24 read as follows:
43-25 (b) On making a deficiency determination, the comptroller
43-26 shall notify the person by [certified] mail or personal service[,
44-1 return receipt requested]. Service by mail is complete when the
44-2 notice is deposited with [received, as evidenced by return receipt
44-3 from] the U.S. Postal Service.
44-4 SECTION 2.42. Sections 154.309(b) and (d), Tax Code, are
44-5 amended to read as follows:
44-6 (b) A written request for redetermination must be filed at
44-7 the office of the comptroller not later than the 30th [15th
44-8 working] day after the date notice of deficiency is issued
44-9 [received]. If a written request for redetermination is not filed
44-10 as required by this subsection, the determination is final.
44-11 (d) The comptroller shall give notice of a redetermination
44-12 hearing by personal service or by [certified] mail[, return receipt
44-13 requested]. Service by mail is complete when the notice is
44-14 deposited with [received, as evidenced by return receipt from] the
44-15 U.S. Postal Service.
44-16 SECTION 2.43. Section 155.059(c), Tax Code, is amended to
44-17 read as follows:
44-18 (c) The comptroller shall deliver [mail] the written notice
44-19 by personal service or by [certified] mail[, return receipt
44-20 requested,] to the permit holder's mailing address as it appears in
44-21 the comptroller's records. Service by mail is complete when the
44-22 notice is deposited with [received, as evidenced by the return
44-23 receipt from] the United States Postal Service.
44-24 SECTION 2.44. Section 155.103(b), Tax Code, is amended to
44-25 read as follows:
44-26 (b) A manufacturer who sells tobacco products to a permit
45-1 holder in this state shall file with the comptroller, on or before
45-2 the last [15th] day of each month, a report showing the information
45-3 listed in Subsection (a) for the previous month.
45-4 SECTION 2.45. Section 155.111(a), Tax Code, is amended to
45-5 read as follows:
45-6 (a) A distributor shall file with the comptroller on or
45-7 before the last [30th] day of each month, a report for the
45-8 preceding month.
45-9 SECTION 2.46. Section 155.185(b), Tax Code, is amended to
45-10 read as follows:
45-11 (b) On making a deficiency determination, the comptroller
45-12 shall notify the person by personal service or by [certified]
45-13 mail[, return receipt requested]. Service by mail is complete when
45-14 the notice is deposited with [received, as evidenced by return
45-15 receipt from] the U.S. Postal Service.
45-16 SECTION 2.47. Sections 155.186(b) and (d), Tax Code, are
45-17 amended to read as follows:
45-18 (b) A written request for redetermination must be filed at
45-19 the office of the comptroller not later than the 30th [15th
45-20 working] day after the date notice of deficiency is issued
45-21 [received]. If a written request for redetermination is not filed
45-22 as required by this subsection, the determination is final.
45-23 (d) The comptroller shall give notice of a redetermination
45-24 hearing by personal service or by [certified] mail[, return receipt
45-25 requested]. Service by mail is complete when the notice is
45-26 deposited with [received, as evidenced by return receipt from] the
46-1 U.S. Postal Service.
46-2 SECTION 2.48. Section 156.102, Tax Code, is amended to read
46-3 as follows:
46-4 Sec. 156.102. EXCEPTION--RELIGIOUS, CHARITABLE, OR
46-5 EDUCATIONAL ORGANIZATION. (a) This chapter does not impose a tax
46-6 on a corporation or association that is organized and operated
46-7 exclusively for a religious, charitable, or educational purpose if
46-8 no part of the net earnings of the corporation or association inure
46-9 to the benefit of a private shareholder or individual.
46-10 (b) For purposes of this section, an institution of higher
46-11 education is organized and operated exclusively for an educational
46-12 purpose only if the institution is defined as an institution of
46-13 higher education under any subdivision of Section 61.003, Education
46-14 Code.
46-15 SECTION 2.49. Sections 156.103(a), (b), (c), and (d), Tax
46-16 Code, are amended to read as follows:
46-17 (a) This [Subject to this section, this] chapter does not
46-18 impose a tax on:
46-19 (1) the United States;
46-20 (2) a governmental entity of the United States[, this
46-21 state, or an agency, institution, board, or commission of this
46-22 state other than an institution of higher education;]
46-23 [(2) an officer or employee of a state governmental
46-24 entity described by Subdivision (1) when traveling on or otherwise
46-25 engaged in the course of official duties for the governmental
46-26 entity]; or
47-1 (3) an officer or employee of a governmental entity of
47-2 the United States when traveling on or otherwise engaged in the
47-3 course of official duties for the governmental entity [if the
47-4 governmental entity directly pays to the hotel the price for the
47-5 room].
47-6 (b) This state, or an agency, institution, board, or
47-7 commission of this state other than an institution of higher
47-8 education [A governmental entity otherwise excepted under this
47-9 section] shall pay the tax imposed by this chapter and is entitled
47-10 to a refund of the amount of tax paid in accordance with Section
47-11 156.154.
47-12 (c) A state officer or employee of a state governmental
47-13 entity described by Subsection (b) [(a)(2)] who is entitled to
47-14 reimbursement for the cost of lodging and for whom a special
47-15 provision or exception to the general rate of reimbursement under
47-16 the General Appropriations Act is not applicable shall pay the tax
47-17 imposed by [under] this chapter [as if it were imposed by this
47-18 chapter]. The state governmental entity with whom the person is
47-19 associated is entitled under Section 156.154 to a refund of the tax
47-20 paid.
47-21 (d) A state officer or employee of a state governmental
47-22 entity described by Subsection (b) [(a)(2)] for whom a special
47-23 provision or exception to the general rate of reimbursement under
47-24 the General Appropriations Act applies and who is provided with
47-25 photo identification verifying the identity and exempt status of
47-26 the person is not required to pay the tax and is not entitled to a
48-1 refund. The photo identification of a state officer or employee
48-2 described by this section may be modified for the purposes of this
48-3 section.
48-4 SECTION 2.50. Section 171.063, Tax Code, is amended by
48-5 amending Subsection (a) and adding Subsection (h) to read as
48-6 follows:
48-7 (a) The following corporations are exempt from the franchise
48-8 tax:
48-9 (1) a nonprofit corporation exempted from the federal
48-10 income tax under Section 501(c)(3), (4), (5), (6), (7), (8), (10),
48-11 or (19), Internal Revenue Code which in the case of a nonprofit
48-12 hospital means a hospital providing community benefits that include
48-13 charity care and government-sponsored indigent health care
48-14 [community benefits] as set forth in Subchapter D, Chapter 311,
48-15 Health and Safety Code; [Paragraph (A), (B), (C), (D), (E), (F), or
48-16 (G):]
48-17 [(A) charity care and government-sponsored
48-18 indigent health care are provided at a level which is reasonable in
48-19 relation to the community needs, as determined through the
48-20 community needs assessment, the available resources of the hospital
48-21 or hospital system, and the tax-exempt benefits received by the
48-22 hospital or hospital system;]
48-23 [(B) charity care and government-sponsored
48-24 indigent health care are provided in an amount equal to at least
48-25 four percent of the hospital's or hospital system's net patient
48-26 revenue;]
49-1 [(C) charity care and government-sponsored
49-2 indigent health care are provided in an amount equal to at least
49-3 100 percent of the hospital's or hospital system's tax-exempt
49-4 benefits, excluding federal income tax;]
49-5 [(D) for tax periods beginning before January 1,
49-6 1996, charity care and community benefits are provided in a
49-7 combined amount equal to at least five percent of the hospital's
49-8 net patient revenue, provided that charity care and
49-9 government-sponsored indigent health care are provided in an amount
49-10 equal to at least three percent of net patient revenue;]
49-11 [(E) for tax periods beginning after December
49-12 31, 1995, charity care and community benefits are provided in a
49-13 combined amount equal to at least five percent of the hospital's or
49-14 hospital system's net patient revenue, provided that charity care
49-15 and government-sponsored indigent health care are provided in an
49-16 amount equal to at least four percent of net patient revenue;]
49-17 [(F) a nonprofit hospital that has been
49-18 designated as a disproportionate share hospital under the state
49-19 Medicaid program in the current year or in either of the previous
49-20 two fiscal years is considered to have provided a reasonable amount
49-21 of charity care and government-sponsored indigent health care and
49-22 is considered in compliance with the standards provided by this
49-23 subsection; or]
49-24 [(G) a hospital operated on a nonprofit basis
49-25 that is located in a county with a population of less than 50,000
49-26 and in which the entire county or the population of the entire
50-1 county has been designated as a health professionals shortage area
50-2 is considered in compliance with the standards provided by this
50-3 subsection;]
50-4 (2) a corporation exempted under Section 501(c)(2) or
50-5 (25), Internal Revenue Code, if the corporation or corporations for
50-6 which it holds title to property is either exempt from or not
50-7 subject to the franchise tax; and
50-8 (3) a corporation exempted from federal income tax
50-9 under Section 501(c)(16), Internal Revenue Code[; and]
50-10 [(4) a nonprofit corporation exempted from the federal
50-11 income tax under Section 501(c)(3), Internal Revenue Code, that
50-12 does not receive any payment for providing health care services to
50-13 inpatients or outpatients from any source including but not limited
50-14 to the patient or person legally obligated to support the patient,
50-15 third-party payors, Medicare, Medicaid, or any other state or local
50-16 indigent care program. Payment for providing health care services
50-17 does not include charitable donations, legacies, bequests, or
50-18 grants or payments for research.]
50-19 [For purposes of satisfying Paragraph (E) of Subdivision (1),
50-20 a hospital or hospital system may not change its existing fiscal
50-21 year unless the hospital or hospital system changes its ownership
50-22 or corporate structure as a result of a sale or merger.]
50-23 [For purposes of this subsection, a hospital that satisfies
50-24 Paragraph (A), (F), or (G) of Subdivision (1) shall be excluded in
50-25 determining a hospital system's compliance with the standards
50-26 provided by Paragraph (B), (C), (D), or (E) of Subdivision (1).]
51-1 [For purposes of this subsection, the terms "charity care,"
51-2 "government-sponsored indigent health care," "health care
51-3 organization," "hospital system," "net patient revenue," "nonprofit
51-4 hospital," and "tax-exempt benefits" have the meanings set forth in
51-5 Sections 311.031 and 311.042, Health and Safety Code. A
51-6 determination of the amount of community benefits and charity care
51-7 and government-sponsored indigent health care provided by a
51-8 hospital or hospital system and the hospital's or hospital system's
51-9 compliance with the requirements of Section 311.045, Health and
51-10 Safety Code, shall be based on the most recently completed and
51-11 audited prior fiscal year of the hospital or hospital system.]
51-12 [A requirement that a nonprofit hospital provide charity care
51-13 and community benefits under this subsection may be satisfied by a
51-14 donation of money to the Texas Healthy Kids Corporation established
51-15 by Chapter 109, Health and Safety Code, provided that:]
51-16 [(1) the money is donated to be used for a purpose
51-17 described by Section 109.033(c), Health and Safety Code; and]
51-18 [(2) not more than 10 percent of the charity care
51-19 required under any provision of this subsection may be satisfied by
51-20 the donation.]
51-21 [The providing of charity care and government-sponsored
51-22 indigent health care in accordance with Paragraph (A) of
51-23 Subdivision (1) shall be guided by the prudent business judgment of
51-24 the hospital which will ultimately determine the appropriate level
51-25 of charity care and government-sponsored indigent health care based
51-26 on the community needs, the available resources of the hospital,
52-1 the tax-exempt benefits received by the hospital, and other factors
52-2 that may be unique to the hospital, such as the hospital's volume
52-3 of Medicare and Medicaid patients. These criteria shall not be
52-4 determinative factors, but shall be guidelines contributing to the
52-5 hospital's decision along with other factors which may be unique to
52-6 the hospital. The formulas contained in Paragraphs (B), (C), (D),
52-7 and (E) of Subdivision (1) shall also not be considered
52-8 determinative of a reasonable amount of charity care and
52-9 government-sponsored indigent health care.]
52-10 [The requirements of this subsection shall not apply to the
52-11 extent a hospital or hospital system demonstrates that reductions
52-12 in the amount of community benefits, charity care, and
52-13 government-sponsored indigent health care are necessary to maintain
52-14 financial reserves at a level required by a bond covenant, are
52-15 necessary to prevent the hospital or hospital system from
52-16 endangering its ability to continue operations, or if the hospital,
52-17 as a result of a natural or other disaster, is required
52-18 substantially to curtail its operations.]
52-19 [In any fiscal year that a hospital or hospital system,
52-20 through unintended miscalculation, fails to meet any of the
52-21 standards in Subdivision (1), the hospital or hospital system shall
52-22 not lose its tax-exempt status without the opportunity to cure the
52-23 miscalculation in the fiscal year following the fiscal year the
52-24 failure is discovered by both meeting one of the standards and
52-25 providing an additional amount of charity care and
52-26 government-sponsored indigent health care that is equal to the
53-1 shortfall from the previous fiscal year. A hospital or hospital
53-2 system may apply this provision only once every five years].
53-3 (h) A requirement that a nonprofit hospital provide charity
53-4 care and community benefits under Subsection (a)(1) may be
53-5 satisfied by a donation of money to the Texas Healthy Kids
53-6 Corporation established by Chapter 109, Health and Safety Code, if:
53-7 (1) the money is donated to be used for a purpose
53-8 described by Section 109.033(c), Health and Safety Code; and
53-9 (2) not more than 10 percent of the charity care
53-10 required under any provision of Section 311.045, Health and Safety
53-11 Code, may be satisfied by the donation.
53-12 SECTION 2.51. Sections 171.063(c) and (d), Tax Code, are
53-13 amended to read as follows:
53-14 (c) A corporation's exemption under Subsection (b) of this
53-15 section is established by furnishing the comptroller with a copy of
53-16 the Internal Revenue Service's letter of exemption issued to the
53-17 corporation. [The copy of the letter must be filed with the
53-18 comptroller within 15 months after the day that is the last day of
53-19 a calendar month and that is nearest to the date of the
53-20 corporation's charter or certificate of authority.]
53-21 (d) If the Internal Revenue Service has not timely issued to
53-22 a corporation a letter of exemption, evidence establishing the
53-23 corporation's provisional exemption under this section is
53-24 sufficient if the corporation timely files with the comptroller
53-25 [within the 15-month period established by Subsection (c) of this
53-26 section] evidence that the corporation has applied in good faith
54-1 for the federal tax exemption. The evidence must be filed not
54-2 later than the 15th month after the day that is the last day of a
54-3 calendar month and that is nearest to the date of the corporation's
54-4 charter or certificate of authority.
54-5 SECTION 2.52. The heading of Subchapter C, Chapter 171, Tax
54-6 Code, is amended to read as follows:
54-7 SUBCHAPTER C. DETERMINATION OF TAXABLE CAPITAL
54-8 AND TAXABLE EARNED SURPLUS; ALLOCATION AND APPORTIONMENT
54-9 SECTION 2.53. The heading of Section 171.1015, Tax Code, is
54-10 amended to read as follows:
54-11 Sec. 171.1015. REDUCTION OF TAXABLE CAPITAL OR TAXABLE
54-12 EARNED SURPLUS FOR INVESTMENT IN AN ENTERPRISE ZONE.
54-13 SECTION 2.54. Section 171.1015(f)(1), Tax Code, is amended
54-14 to read as follows:
54-15 (1) "Enterprise project" means a person designated by
54-16 the Texas Department of Economic Development [Commerce] as an
54-17 enterprise project under Chapter 2303, Government Code.
54-18 SECTION 2.55. Section 171.1015(g), Tax Code, is amended to
54-19 read as follows:
54-20 (g) Only qualified businesses that have been certified as
54-21 eligible for a tax deduction under this section by the Texas
54-22 Department of Economic Development [Commerce] to the comptroller
54-23 and the Legislative Budget Board are entitled to the tax deduction.
54-24 SECTION 2.56. The heading of Section 171.1016, Tax Code, is
54-25 amended to read as follows:
54-26 Sec. 171.1016. REDUCTION OF TAXABLE CAPITAL OR TAXABLE
55-1 EARNED SURPLUS FOR INVESTMENT IN A READJUSTMENT ZONE.
55-2 SECTION 2.57. Section 171.1016(f)(1), Tax Code, is amended
55-3 to read as follows:
55-4 (1) "Defense readjustment project" means a person
55-5 designated by the Texas Department of Economic Development
55-6 [Commerce] as a defense readjustment project under Chapter 2310,
55-7 Government Code.
55-8 SECTION 2.58. Section 171.1016(g), Tax Code, is amended to
55-9 read as follows:
55-10 (g) Only qualified businesses that have been certified as
55-11 eligible for a tax deduction under this section by the Texas
55-12 Department of Economic Development [Commerce] to the comptroller
55-13 and the Legislative Budget Board are entitled to the tax deduction.
55-14 SECTION 2.59. The heading of Section 171.107, Tax Code, is
55-15 amended to read as follows:
55-16 Sec. 171.107. DEDUCTION OF COST OF SOLAR ENERGY DEVICE FROM
55-17 TAXABLE CAPITAL OR TAXABLE EARNED SURPLUS APPORTIONED TO THIS
55-18 STATE.
55-19 SECTION 2.60. Section 171.110, Tax Code, is amended by
55-20 adding Subsections (i) and (j) to read as follows:
55-21 (i) For purposes of this section, any person designated as
55-22 an officer is presumed to be an officer if that person:
55-23 (1) holds an office created by the board of directors
55-24 or under the corporate charter or bylaws; and
55-25 (2) has legal authority to bind the corporation with
55-26 third parties by executing contracts or other legal documents.
56-1 (j) A corporation may rebut the presumption described in
56-2 Subsection (i) that a person is an officer if it conclusively
56-3 shows, through the person's job description or other documentation,
56-4 that the person does not participate or have authority to
56-5 participate in significant policy making aspects of the corporate
56-6 operations.
56-7 SECTION 2.61. Section 171.501(a), Tax Code, is amended to
56-8 read as follows:
56-9 (a) A corporation that has been certified a qualified
56-10 business as provided by Chapter 2303, Government Code may apply for
56-11 and be granted a refund of franchise tax paid with an initial or
56-12 annual report if the governing body or bodies certify to the Texas
56-13 Department of Economic Development [Commerce] that the business has
56-14 created 10 or more new jobs in its enterprise zone held by
56-15 qualified employees during the calendar year that contains the end
56-16 of the accounting period on which the report is based. The Texas
56-17 Department of Economic Development [Commerce] shall certify
56-18 eligibility for any refund to the comptroller.
56-19 SECTION 2.62. The heading of Subchapter C, Chapter 183, Tax
56-20 Code, is amended to read as follows:
56-21 SUBCHAPTER C. MIXED BEVERAGE TAX CLEARANCE [FUND]
56-22 SECTION 2.63. The heading of Section 183.051, Tax Code, is
56-23 amended to read as follows:
56-24 Sec. 183.051. MIXED BEVERAGE TAX CLEARANCE [FUND].
56-25 SECTION 2.64. Section 183.051(b), Tax Code, is amended to
56-26 read as follows:
57-1 (b) The comptroller shall issue to each county described in
57-2 Subsection (a) a warrant drawn on the general revenue [mixed
57-3 beverage tax clearance] fund in an [the] amount appropriated by the
57-4 legislature that may not be greater than [of] 10.7143 percent of
57-5 receipts from permittees within the county during the quarter and
57-6 shall issue to each incorporated municipality described in
57-7 Subsection (a) a warrant drawn on that fund in an [the] amount
57-8 appropriated by the legislature that may not be greater than [of]
57-9 10.7143 percent of receipts from permittees within the incorporated
57-10 municipality during the quarter. [The remainder of the receipts
57-11 for the quarter and all interest earned on that fund shall be
57-12 transferred to the general revenue fund.]
57-13 SECTION 2.65. Section 191.085(b), Tax Code, is amended to
57-14 read as follows:
57-15 (b) The person shall keep the record open for four [two]
57-16 years for inspection by the comptroller or the attorney general.
57-17 SECTION 2.66. Section 203.051(a), Tax Code, is amended to
57-18 read as follows:
57-19 (a) A producer shall keep a complete record of all sulphur
57-20 he produces in this state. A producer may destroy a record
57-21 required by this section four [three] years after the last entry in
57-22 the record.
57-23 SECTION 2.67. Section 321.102, Tax Code, is amended by
57-24 adding Subsections (e), (f), and (g) to read as follows:
57-25 (e) If as a result of the imposition or increase in a sales
57-26 and use tax by a municipality in which there is located all or part
58-1 of a local governmental entity that has adopted a sales and use tax
58-2 or as a result of the annexation by a municipality of all or part
58-3 of the territory in a local governmental entity that has adopted a
58-4 sales and use tax the overlapping local sales and use taxes in the
58-5 area will exceed two percent, the entity's sales and use tax is
58-6 automatically reduced in that area to a rate that when added to the
58-7 combined rate of local sales and use taxes will equal two percent.
58-8 (f) If an entity's rate is reduced in accordance with
58-9 Subsection (e), the comptroller shall withhold from the
58-10 municipality's monthly sales and use tax allocation an amount equal
58-11 to the amount that would have been collected by the entity had the
58-12 municipality not imposed or increased its sales and use tax or
58-13 annexed the area in the entity less amounts that the entity
58-14 collects following the municipality's levy of or increase in its
58-15 sales and use tax or annexation of the area in the entity. The
58-16 comptroller shall withhold and pay the amount withheld to the
58-17 entity under policies or procedures that the comptroller considers
58-18 reasonable.
58-19 (g) A transit authority is not a local governmental entity
58-20 for the purposes of Subsections (e) and (f).
58-21 SECTION 2.68. Section 322.302, Tax Code, is amended to read
58-22 as follows:
58-23 Sec. 322.302. DISTRIBUTION OF TRUST FUNDS. At [(a) Except
58-24 as provided by Subsection (b) of this section, at] least quarterly
58-25 [twice] during each state fiscal year and as often as feasible, the
58-26 comptroller shall send to the person at each taxing entity who
59-1 performs the function of entity treasurer, payable to the taxing
59-2 entity, the entity's share of the taxes collected by the
59-3 comptroller under this chapter.
59-4 [(b) The comptroller shall make payments required by
59-5 Subsection (a) of this section to entities created under Chapter
59-6 451 or 452, Transportation Code, quarterly each fiscal year as soon
59-7 as practicable after the end of each quarter.]
59-8 SECTION 2.69. Section 323.102(c), Tax Code, is amended to
59-9 read as follows:
59-10 (c) A tax imposed under Section 323.105 of this code or
59-11 Chapter 326, Local Government Code, takes effect on the first day
59-12 of the first calendar quarter after the expiration of the first
59-13 complete calendar quarter occurring after the date on which the
59-14 comptroller receives a notice of the action as required by Section
59-15 323.405(b).
59-16 SECTION 2.70. Section 323.105(e), Tax Code, is amended to
59-17 read as follows:
59-18 (e) The comptroller shall remit to the county amounts
59-19 collected at the rate imposed under this section as part of the
59-20 regular allocation of county tax revenue collected by the
59-21 comptroller if the district is composed of the entire county. The
59-22 comptroller [county] shall, if the district is composed of an area
59-23 less than the entire county, remit that amount to the district.
59-24 Retailers may not be required to use the allocation and reporting
59-25 procedures in the collection of taxes under this section different
59-26 from the procedures that retailers use in the collection of other
60-1 sales and use taxes under this chapter. An item, transaction, or
60-2 service that is taxable in a county under a sales or use tax
60-3 authorized by another section of this chapter is taxable under this
60-4 section. An item, transaction, or service that is not taxable in a
60-5 county under a sales or use tax authorized by another section of
60-6 this chapter is not taxable under this section.
60-7 SECTION 2.71. Section 351.001, Tax Code, is amended by
60-8 adding Subdivision (10) to read as follows:
60-9 (10) "Revenue" includes any interest derived from the
60-10 revenue.
60-11 SECTION 2.72. Section 351.006, Tax Code, is amended to read
60-12 as follows:
60-13 Sec. 351.006. EXEMPTION. (a) A United States governmental
60-14 entity described in Section 156.103(a) is exempt from the payment
60-15 of tax authorized by this chapter [excepted from the tax imposed
60-16 by Chapter 156 under Section 156.103(a)(1) or (a)(3) shall pay the
60-17 tax imposed by this chapter but is entitled to a refund of the tax
60-18 paid].
60-19 (b) A state governmental entity described in Section
60-20 156.103(b) shall pay the tax imposed by this chapter but is
60-21 entitled to a refund of the tax paid.
60-22 (c) A person who is described by Section 156.103(d) is
60-23 exempt from the payment of the tax authorized by this chapter.
60-24 (d) [(c)] A person who is described by Section 156.103(c)
60-25 shall pay the tax imposed by this chapter but the state
60-26 governmental entity with whom the person is associated is entitled
61-1 to a refund of the tax paid.
61-2 (e) [(d)] To receive a refund of tax paid under this
61-3 chapter, the governmental entity entitled to the refund must file a
61-4 refund claim on a form provided by the municipality and containing
61-5 the information required by the municipality. The comptroller by
61-6 rule shall prescribe the form that must be used and the information
61-7 that must be provided.
61-8 (f) [(e)] A governmental entity may file a refund claim with
61-9 the municipality under this chapter only for each calendar quarter
61-10 for all reimbursements accrued during that quarter. The
61-11 municipality may adopt an ordinance to enforce this section.
61-12 SECTION 2.73. Subchapter B, Chapter 351, Tax Code, is
61-13 amended by adding Section 351.107 to read as follows:
61-14 Sec. 351.107. RECORDS. A municipality shall maintain a
61-15 record that accurately identifies the receipt and expenditure of
61-16 all revenue derived from the tax imposed under this chapter.
61-17 SECTION 2.74. Section 352.007, Tax Code, is amended to read
61-18 as follows:
61-19 Sec. 352.007. EXEMPTION. (a) A United States governmental
61-20 entity described in Section 156.103(a) is exempt from the payment
61-21 of tax authorized by this chapter [excepted from the tax imposed by
61-22 Chapter 156 under Section 156.103(a)(1) or (a)(3) shall pay the tax
61-23 imposed by this chapter but is entitled to a refund of the tax
61-24 paid].
61-25 (b) A state governmental entity subject to the tax imposed
61-26 by Chapter 156 under Section 156.103(b) shall pay the tax imposed
62-1 by this chapter but is entitled to a refund of the tax paid.
62-2 (c) A person who is described by Section 156.103(d) is
62-3 exempt from the payment of the tax authorized by this chapter.
62-4 (d) [(c)] A person who is described by Section 156.103(c)
62-5 shall pay the tax imposed by this chapter but the state
62-6 governmental entity with whom the person is associated is entitled
62-7 to a refund of the tax paid.
62-8 (e) [(d)] To receive a refund of a tax paid under this
62-9 chapter, the governmental entity entitled to the refund must file a
62-10 refund claim on a form provided by the county and containing the
62-11 information required by the county. The comptroller by rule shall
62-12 prescribe the form that must be used and the information that must
62-13 be provided.
62-14 (f) [(e)] A governmental entity may file a refund claim with
62-15 the county under this chapter only for each calendar quarter for
62-16 all reimbursements accrued during that quarter. The county may
62-17 adopt a resolution to enforce this section.
62-18 SECTION 2.75. Section 4B(e), Development Corporation Act of
62-19 1979 (Article 5190.6, Vernon's Texas Civil Statutes), as amended by
62-20 Section 3, Chapter 1022, and Section 12, Chapter 1031, Acts of the
62-21 73rd Legislature, Regular Session, 1993, is reenacted to read as
62-22 follows:
62-23 (e) The rate of a tax adopted under this section must be
62-24 one-eighth, one-fourth, three-eighths, or one-half of one percent.
62-25 The ballot proposition at the election held to adopt the tax must
62-26 specify the rate of the tax to be adopted. A corporation that
63-1 holds an election to reduce a tax imposed under Section 4A of this
63-2 Act may in a separate proposition on the same ballot adopt a tax
63-3 under this section. If an eligible city adopts the tax, a tax is
63-4 imposed on the receipts from the sale at retail of taxable items
63-5 within the eligible city at the rate approved at the election.
63-6 There is also imposed an excise tax on the use, storage, or other
63-7 consumption within the eligible city of tangible personal property
63-8 purchased, leased, or rented from a retailer during the period that
63-9 the tax is effective within the eligible city. The rate of the
63-10 excise tax is the same as the rate of the sales tax portion of the
63-11 tax and is applied to the sale price of the tangible personal
63-12 property.
63-13 Explanation: This change is needed to allow the legislature
63-14 to make certain technical changes to statutes involving taxes or
63-15 fees administered by the comptroller of public accounts.
63-16 (2) Senate Rule 12.03(4) is suspended to permit the
63-17 committee to add additional text not included in either the house
63-18 or senate version of the bill, consisting of a new article of the
63-19 bill, to read as follows:
63-20 ARTICLE 3. APPROPRIATIONS AND PROVISIONS RELATED TO
63-21 APPROPRIATIONS
63-22 SECTION 3.01. (a) In addition to other amounts appropriated
63-23 by the 76th Legislature, Regular Session, 1999, for the biennium
63-24 beginning September 1, 1999, and subject to the restrictions
63-25 provided under Articles II and IX, House Bill No. 1, Acts of the
63-26 76th Legislature, Regular Session, 1999 (the General Appropriations
64-1 Act), specifically including Rider 38, page II-66, House Bill No.
64-2 1, the Texas Department of Human Services is appropriated $12
64-3 million from the general revenue fund for fiscal year 2000 for
64-4 reimbursement expenses related to increases in reimbursement rates
64-5 for nursing homes under the medical assistance program and $12
64-6 million from the general revenue fund for fiscal year 2001 for the
64-7 same purpose. Any unexpended balance of the appropriation made by
64-8 this section for fiscal year 2000 is reappropriated to the
64-9 department for fiscal year 2001 for the same purpose.
64-10 (b) The Texas Department of Human Services is authorized to
64-11 transfer the appropriations made by this section to the appropriate
64-12 agency or the appropriate strategy item.
64-13 (c) The appropriations made by this section are contingent
64-14 on the comptroller's providing of notice to the governor and the
64-15 Legislative Budget Board that the comptroller has made a finding,
64-16 based on a revenue estimate made before or after the adjournment
64-17 sine die of the 76th Legislature, Regular Session, that sufficient
64-18 revenue is estimated to be available from the general revenue fund
64-19 to provide for the appropriations made by this section.
64-20 SECTION 3.02. (a) In addition to other amounts
64-21 appropriated by the 76th Legislature, Regular Session, 1999, for
64-22 the biennium beginning September 1, 1999, and subject to the
64-23 restrictions provided under Articles II and IX, House Bill No. 1,
64-24 Acts of the 76th Legislature, Regular Session, 1999 (the General
64-25 Appropriations Act), the Texas Department of Human Services is
64-26 appropriated $6.6 million from the general revenue fund for fiscal
65-1 year 2000 for expenses related to increases in the personal needs
65-2 allowance provided under Section 32.024, Human Resources Code, for
65-3 a person who receives medical assistance and is a resident of a
65-4 convalescent or nursing home or related institution licensed under
65-5 Chapter 242, Health and Safety Code, a personal care facility, an
65-6 ICF-MR facility, or another similar long-term care facility and
65-7 $6.6 million from the general revenue fund for fiscal year 2001 for
65-8 the same purpose. Any unexpended balance of the appropriation made
65-9 by this section for fiscal year 2000 is reappropriated to the
65-10 department for fiscal year 2001 for the same purpose.
65-11 (b) The Texas Department of Human Services is authorized to
65-12 transfer the appropriations made by this section to the appropriate
65-13 agency or the appropriate strategy item.
65-14 (c) The appropriations made by this section are contingent
65-15 on the comptroller's providing of notice to the governor and the
65-16 Legislative Budget Board that the comptroller has made a finding,
65-17 based on a revenue estimate made before or after the adjournment
65-18 sine die of the 76th Legislature, Regular Session, that sufficient
65-19 revenue is estimated to be available from the general revenue fund
65-20 to provide for the appropriations made by this section.
65-21 SECTION 3.03. (a) This section applies only to an Act of
65-22 the 76th Legislature, Regular Session, that contains a provision
65-23 stating that the Act, or a provision of the Act, takes effect only
65-24 if a specific appropriation for the implementation of the Act is
65-25 provided in House Bill No. 1, Acts of the 76th Legislature, Regular
65-26 Session, 1999 (the General Appropriations Act).
66-1 (b) In accordance with the terms of the provision described
66-2 by Subsection (a) of this section, the following Acts take effect:
66-3 (1) House Bill Nos. 424, 713, 714, 820, 1172, 1188,
66-4 1341, 1652, 1833, 1939, 2085, 2145, 2202, 2307, 2573, 2641, 2719,
66-5 2992, 3174, 3504, 3517, and 3778; and
66-6 (2) Senate Bill Nos. 526, 565, 666, 708, 1287, 1423,
66-7 1651, and 1690.
66-8 (c) In accordance with the terms of the provision described
66-9 by Subsection (a) of this section, the following Acts do not take
66-10 effect:
66-11 (1) House Bill Nos. 1933 and 2148; and
66-12 (2) Senate Bill Nos. 313, 840, and 1650.
66-13 (d) The following Acts take effect notwithstanding the
66-14 provision described by Subsection (a) of this section:
66-15 (1) House Bill Nos. 64, 153, 628, 676, 1018, 1140,
66-16 1223, 1444, 1860, 2631, 2815, 2896, 2978, 3050, 3079, 3304, and
66-17 3757; and
66-18 (2) Senate Bill Nos. 229, 913 and 1613.
66-19 (e) The Acts identified in this section take effect, or do
66-20 not take effect, as provided by this section, notwithstanding the
66-21 provision described by Subsection (a) of this section.
66-22 (f) If a provision described by Subsection (a) of this
66-23 section is contained in a bill that is not listed in Subsection
66-24 (b), (c), or (d) of this section, the provision is ineffective, and
66-25 the bill takes effect in accordance with its terms notwithstanding
66-26 that provision, regardless of the relative dates of enactment.
67-1 Explanation: This change is needed to allow the legislature
67-2 to appropriate additional money to the Texas Department of Human
67-3 Services and to address the issue of whether certain bills are
67-4 funded by an appropriation in the General Appropriations Act.
67-5 (3) Senate Rule 12.03(4) is suspended to permit the
67-6 committee to add additional text not included in either the house
67-7 or senate version of the bill, relating to the implementation of
67-8 the new articles added to the bill, to read as follows:
67-9 SECTION 4.01. The following are repealed: . . .
67-10 (3) Sections 151.318(g) and (p) and 152.062(d), Tax
67-11 Code.
67-12 SECTION 4.07. A tax to which Section 2.69 of this Act
67-13 applies that is not being collected on the effective date of this
67-14 Act and that was adopted at an election held before January 1,
67-15 1999, takes effect on the first day of the first calendar quarter
67-16 that begins after the effective date of this Act.
67-17 SECTION 4.08. Each change in law made to the following
67-18 provisions by this Act is a clarification of existing law and does
67-19 not imply that existing law may be construed as inconsistent with
67-20 the law as amended by this Act:
67-21 (1) Section 102.075, Code of Criminal Procedure;
67-22 (2) Section 9, Texas State College and University
67-23 Employees Uniform Insurance Benefits Act (Article 3.50-3, Vernon's
67-24 Texas Insurance Code);
67-25 (3) Section 11, Texas Public School Employees Group
67-26 Insurance Act (Article 3.50-4, Insurance Code);
68-1 (4) Section 326.029, Local Government Code;
68-2 (5) Section 326.092, Local Government Code;
68-3 (6) Section 151.317, Tax Code;
68-4 (7) Section 151.318, Tax Code;
68-5 (8) Section 151.3185, Tax Code;
68-6 (9) Section 151.350(d), Tax Code;
68-7 (10) Section 152.002, Tax Code;
68-8 (11) Section 152.041, Tax Code;
68-9 (12) Section 153.117, Tax Code;
68-10 (13) Section 153.119, Tax Code;
68-11 (14) Section 153.206, Tax Code;
68-12 (15) Section 153.219, Tax Code;
68-13 (16) Section 171.063, Tax Code;
68-14 (17) the heading of Subchapter C, Chapter 171, Tax
68-15 Code;
68-16 (18) the headings of Sections 171.1015, 171.1016, and
68-17 171.107, Tax Code;
68-18 (19) Section 171.110, Tax Code;
68-19 (20) Section 191.085, Tax Code; and
68-20 (21) Section 203.051, Tax Code.
68-21 SECTION 4.09. The comptroller of public accounts may adopt
68-22 rules and take other actions before October 1, 1999, as the
68-23 comptroller deems necessary or advisable to prepare for the taking
68-24 effect of Article 2 of this Act.
68-25 SECTION 4.10. (a) Except as provided by Subsections (b),
68-26 (c), and (d) of this section, Article 2 of this Act takes effect
69-1 October 1, 1999.
69-2 (b) Section 2.05 of this Act takes effect January 1, 2000,
69-3 and applies to reporting periods beginning on or after that date.
69-4 (c) Sections 2.50 through 2.61 of this Act take effect
69-5 January 1, 2000, and apply to a report originally due on or after
69-6 that date.
69-7 SECTION 4.12. (a) This Act takes effect immediately except
69-8 that: . . .
69-9 (4) Article 2 of this Act takes effect as provided by
69-10 Section 4.10 of this Act.
69-11 Explanation: This addition is necessary to provide for the
69-12 orderly implementation of the changes made by adding new articles
69-13 to the bill.
69-14 ______________________________________
69-15 President of the Senate
69-16 I hereby certify that the above
69-17 Resolution was adopted by the Senate
69-18 on May 30, 1999, by the following vote:
69-19 Yeas 30, Nays 0.
69-20 ______________________________________
69-21 Secretary of the Senate