By Eiland H.B. No. 1170
77R3618 CBH-F
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to an exemption from the sales and use tax for taxable
1-3 items used in the performance of a space flight contract.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Subchapter H, Chapter 151, Tax Code, is amended
1-6 by adding Section 151.355 to read as follows:
1-7 Sec. 151.355. TAXABLE ITEMS USED IN PERFORMANCE OF SPACE
1-8 FLIGHT CONTRACT. (a) In this section:
1-9 (1) "Space flight contract" means a contract with the
1-10 United States Department of Defense, the National Aeronautics and
1-11 Space Administration, or another nongovernmental party for the use
1-12 or provision of taxable items related to the development,
1-13 construction or fabrication, testing, research and development,
1-14 vehicle assembly, processing, remodeling, repair, operation, or
1-15 maintenance of space vehicles and related facilities.
1-16 (2) "Space vehicles and related facilities" means
1-17 tangible personal property that:
1-18 (A) has space flight capability, including a
1-19 space shuttle, orbital space facility, space propulsion system,
1-20 satellite, or space station of any kind;
1-21 (B) is placed on or used aboard property
1-22 described by Subdivision (A); or
1-23 (C) is an integral part of and is used in
1-24 support of a space flight, including tangible personal property
2-1 used in training, launch, ground support, landing, and recovery
2-2 activities.
2-3 (b) A taxable item sold, leased, rented to, or stored, used,
2-4 or consumed by a person in the performance of a space flight
2-5 contract is exempt from the taxes imposed by this chapter if the
2-6 item is included as an allowable direct or indirect item of cost
2-7 under 48 C.F.R. Section 9904.418-30, 48 C.F.R. Section 52.216-7, 48
2-8 C.F.R. Subpart 31.2, or similar federal regulations, regardless of
2-9 whether the contract is a cost-reimbursement contract.
2-10 (c) This section does not apply to a part of direct or
2-11 indirect costs allocated to a contract that is not a space flight
2-12 contract.
2-13 SECTION 2. (a) This Act takes effect July 1, 2001, if it
2-14 receives a vote of two-thirds of all the members elected to each
2-15 house, as provided by Section 39, Article III, Texas Constitution.
2-16 If this Act does not receive the vote necessary for effect on that
2-17 date, this Act takes effect October 1, 2001.
2-18 (b) The change in law made by this Act does not affect taxes
2-19 imposed before the effective date of this Act, and the former law
2-20 is continued in effect for purposes of the liability for and
2-21 collection of those taxes.