HBA-JLV H.B. 1098 77(R) BILL ANALYSIS Office of House Bill AnalysisH.B. 1098 By: Bonnen Ways and Means 3/1/2001 Introduced BACKGROUND AND PURPOSE Current law requires a seller to add the amount of the sales tax to the sales price of tangible personal property or taxable services but is ambiguous concerning tax liability on printed materials distributed by mail. There exists a need to clarify provisions attaching tax liability to the purchaser of printed materials. The purchaser, rather than the printer, has access to the information necessary to determine where the printed materials were mailed and is then able to use the information for their tax purposes. House Bill 1098 provides that a purchaser of printed materials has sole responsibility for any taxes that may be imposed on those materials when the printer of materials delivers them to the United States Postal Service for mailing to persons other than the purchaser located within and outside of this state. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that rulemaking authority is expressly delegated to the comptroller of public accounts of the State of Texas in SECTION 3 of this bill. ANALYSIS House Bill 1098 amends the Tax Code to provide that a purchaser of printed materials has sole responsibility for any taxes that may be imposed on those materials when the printer of materials delivers them to the United States Postal Service for mailing to persons other than the purchaser located within and outside of this state. The bill provides that a printer of materials delivered by mail to persons other than the purchaser located within and outside this state has no duty with respect to the payment or collection of any taxes imposed on printed materials. The bill requires a printer to collect the sales taxes imposed on printed materials when all or substantially all of the materials will be mailed to persons located within this state. The bill provides a rebuttable presumption, for purposes of the printer's tax collection duty, that all materials printed at a facility are mailed to persons located within the state in which the facility is located. A purchaser that supplies a certificate to a printer concerning the delivery of the printed materials for a specific purchase is sufficient to rebut this presumption. The bill authorizes the comptroller of public accounts of the State of Texas to adopt rules and forms to implement the tax collection on printed materials distributed by mail. EFFECTIVE DATE July 1, 2001, or if the Act does not receive the necessary vote, the Act takes effect September 1, 2001.