SRC-SEW S.B. 1471 77(R)   BILL ANALYSIS


Senate Research Center   S.B. 1471
77R7203 SMJ-DBy: Ogden
Finance
3/28/2001
As Filed


DIGEST AND PURPOSE 

Under current law, meals served at public schools, hospitals, and nursing
homes are not taxed; however, students at institutions of higher education
are taxed when they purchase meal plans from universities and then taxed
again when they purchase food products at locations other than the
designated cafeteria.  Also, students are automatically taxed for three
meals per day upon meal plan purchase, regardless of how often they eat,
but the food service contractor for the dining center is only paid when the
students eat in the designated cafeteria.  As proposed, S.B. 1471 exempts
student meal plans at institutions of higher education from sales tax in
order to align them with other state-funded plans and to resolve this
double-tax practice. 

RULEMAKING AUTHORITY

This bill does not expressly grant any additional rulemaking authority to a
state officer, institution, or agency. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Section 151.314(d), Tax Code, to provide that food
products, meals, soft drinks, and candy for human consumption are exempted
from taxes imposed by this chapter if served to a student at an institution
of higher education or a private or independent institution of higher
education, as those terms are defined by Section 61.003 (Definitions),
Education Code, as part of a meal plan program provided by the institution. 

SECTION 2.  Effective date: July 1, 2001, or October 1, 2001.
  Makes application of this Act prospective.