By Davis of Harris H.B. No. 3291
77R5992 YDB-D
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to eliminating the licensing and registration requirements
1-3 for music, skill, or pleasure coin-operated machines.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Sections 2153.005 and 2153.006, Occupations Code,
1-6 are amended to read as follows:
1-7 Sec. 2153.005. EXEMPT CORPORATIONS AND ASSOCIATIONS. [(a)]
1-8 A corporation or association owning, leasing, or renting a music or
1-9 skill or pleasure coin-operated machine is exempt from the tax
1-10 imposed under Subchapter D if:
1-11 (1) the corporation or association is organized and
1-12 operated exclusively for religious, charitable, educational, or
1-13 benevolent purposes;
1-14 (2) the corporation's or association's net earnings do
1-15 not inure to the benefit of a private shareholder or individual;
1-16 and
1-17 (3) the corporation or association owns, leases, or
1-18 rents the coin-operated machine:
1-19 (A) for the corporation's or association's
1-20 exclusive use; and
1-21 (B) to further a purpose of the corporation or
1-22 association.
1-23 [(b) A tax may not be assessed against a corporation or an
1-24 association exempt under this section if assessment of the tax is
2-1 prohibited by other law.]
2-2 Sec. 2153.006. PRIVATE OWNERSHIP EXEMPT. An individual who
2-3 owns a music or skill or pleasure coin-operated machine for
2-4 personal use and amusement in the individual's private residence is
2-5 not required to [obtain a license or] pay a tax under this chapter.
2-6 SECTION 2. Section 2153.051, Occupations Code, is amended to
2-7 read as follows:
2-8 Sec. 2153.051. GENERAL DUTIES OF COMPTROLLER. (a) The
2-9 comptroller shall administer this chapter.
2-10 (b) To administer this chapter, the comptroller may:
2-11 (1) [issue a license or registration certificate;]
2-12 [(2) prescribe procedures for registering music and
2-13 skill or pleasure coin-operated machines;]
2-14 [(3)] prescribe methods for[:]
2-15 [(A)] securely attaching a tax permit to a
2-16 coin-operated machine;
2-17 (2) [and]
2-18 [(B) posting a license or registration
2-19 certificate;]
2-20 [(4)] prescribe the form and content of a:
2-21 (A) [license application;]
2-22 [(B) registration certificate;]
2-23 [(C)] tax permit;
2-24 (B) [(D)] report specifying a coin-operated
2-25 machine's location; and
2-26 (C) [(E)] report of the consideration of each
2-27 party to a contract relating to the placement of a coin-operated
3-1 machine in an establishment [owned by a person other than the
3-2 license holder]; and
3-3 (3) [(5)] disclose confidential information to an
3-4 appropriate official.
3-5 SECTION 3. Section 2153.053(a), Occupations Code, is amended
3-6 to read as follows:
3-7 (a) The comptroller may:
3-8 (1) conduct an investigation, hold a hearing, or take
3-9 other necessary action to:
3-10 (A) ensure compliance with this chapter; or
3-11 (B) identify a violation of this chapter;
3-12 (2) conduct an investigation of a violation of this
3-13 chapter, or a rule adopted under this chapter, committed by a
3-14 person who owns, operates, exhibits, or displays a coin-operated
3-15 machine in this state; or
3-16 (3) [deny an application for a license or registration
3-17 certificate in accordance with Subchapter G; or]
3-18 [(4)] impose sanctions, including suspending or
3-19 revoking a person's [license, registration certificate, or] tax
3-20 permit in accordance with this chapter [Subchapter G].
3-21 SECTION 4. Section 2153.058, Occupations Code, is amended to
3-22 read as follows:
3-23 Sec. 2153.058. DEPOSIT OF REVENUE. The [Except as provided
3-24 by Section 2153.257, the] comptroller shall deposit one-fourth of
3-25 the revenue received under this chapter in the foundation school
3-26 fund and three-fourths of the revenue received under this chapter
3-27 in the general revenue fund.
4-1 SECTION 5. Section 2153.102, Occupations Code, is amended to
4-2 read as follows:
4-3 Sec. 2153.102. INFORMATION MADE AVAILABLE TO COMPTROLLER.
4-4 Except for information specifically designated as a public record,
4-5 information derived from a book, record, or report[, or
4-6 application] required to be made available under this chapter to
4-7 the comptroller or the attorney general:
4-8 (1) is confidential; and
4-9 (2) may be used only to enforce this chapter.
4-10 SECTION 6. Subchapter I, Chapter 2153, Occupations Code, is
4-11 redesignated as Subchapter D, Chapter 2153, Occupations Code, and
4-12 amended to read as follows:
4-13 SUBCHAPTER D [I]. STATE OCCUPATION TAX
4-14 Sec. 2153.121 [2153.401]. IMPOSITION OF TAX. (a) An
4-15 occupation tax is imposed on each coin-operated machine that an
4-16 owner exhibits or displays, or permits to be exhibited or displayed
4-17 in this state.
4-18 (b) The tax rate is $60 per year.
4-19 Sec. 2153.122 [2153.402]. EXEMPTION. The tax imposed under
4-20 this subchapter does not apply to an owner of a coin-operated
4-21 machine or a machine that is exempt from the tax under another
4-22 provision of this chapter or if the owner:
4-23 (1) holds an import license; and
4-24 (2) possesses the coin-operated machine for resale
4-25 only.
4-26 Sec. 2153.123 [2153.403]. PRORATED TAX. The tax on a
4-27 coin-operated machine first exhibited or displayed in this state
5-1 after March 31 is one-fourth of the tax imposed under Section
5-2 2153.121 [2153.401] for each quarter or partial quarter of the
5-3 calendar year remaining after the date the owner first exhibits or
5-4 displays the coin-operated machine.
5-5 Sec. 2153.124 [2153.404]. COLLECTION. (a) The comptroller
5-6 shall collect the tax.
5-7 (b) In collecting the tax, the comptroller may:
5-8 (1) collect the tax on a quarterly basis;
5-9 (2) establish procedures for quarterly collection of
5-10 the tax; and
5-11 (3) establish dates on which the tax payment is due.
5-12 (c) An owner required to pay a tax under this subchapter
5-13 [section] shall pay the tax to the comptroller by cashier's check
5-14 or money order.
5-15 Sec. 2153.125 [2153.405]. REFUND OR CREDIT PROHIBITED. The
5-16 comptroller may not refund or assign credit for the tax imposed
5-17 under this subchapter to an owner who ceases to exhibit or display
5-18 a coin-operated machine before the end of the calendar year for
5-19 which the tax is imposed.
5-20 Sec. 2153.126 [2153.406]. TAX PERMIT. (a) The comptroller
5-21 shall issue a tax permit to an owner who pays the tax.
5-22 (b) The comptroller may issue a duplicate tax permit to an
5-23 owner if the owner's tax permit is lost, stolen, or destroyed. The
5-24 fee for a duplicate permit is $5.
5-25 (c) A [Except as provided by Subsection (d), a] tax permit
5-26 shall be securely attached to the coin-operated machine for which
5-27 the permit is issued in a manner that requires continued
6-1 application of steam and water to remove the permit.
6-2 [(d) A person may not attach a tax permit to a coin-operated
6-3 machine that is exhibited or displayed if the machine is not
6-4 registered with the comptroller under this chapter.]
6-5 Sec. 2153.127 [2153.407]. APPLICABILITY OF TAX CODE.
6-6 Subtitle B, Title 2, Tax Code, applies to the administration,
6-7 collection, and enforcement of taxes, penalties, and interest under
6-8 this subchapter.
6-9 SECTION 7. Section 2153.201(b), Occupations Code, is amended
6-10 to read as follows:
6-11 (b) A record required under Subsection (a) must:
6-12 (1) be available at all times for inspection by the
6-13 attorney general, the comptroller, or an authorized representative
6-14 of the attorney general or comptroller;
6-15 (2) include information relating to:
6-16 (A) the kind of each machine;
6-17 (B) the date each machine is:
6-18 (i) acquired or received in this state;
6-19 and
6-20 (ii) placed in operation;
6-21 (C) the location of each machine, including the:
6-22 (i) county;
6-23 (ii) municipality, if any; and
6-24 (iii) street or rural route number;
6-25 (D) the name and complete address of each
6-26 operator of each machine;
6-27 (E) if the owner is an individual, the full name
7-1 and address of the owner; and
7-2 (F) if the owner is not an individual, the name
7-3 and address of each principal officer or member of the owner; and
7-4 (3) be maintained:
7-5 (A) at a permanent address in this state
7-6 [designated on the application for a license under Section
7-7 2153.153]; and
7-8 (B) until the second anniversary of the date the
7-9 owner ceases ownership of the machine that is the subject of the
7-10 record.
7-11 SECTION 8. Section 2153.202, Occupations Code, is amended to
7-12 read as follows:
7-13 Sec. 2153.202. REQUIRED [LICENSE HOLDER] RECORDS AND
7-14 REPORTING. (a) The comptroller may require the owner or operator
7-15 of a coin-operated machine subject to the tax under Subchapter D to
7-16 [A license holder shall] maintain a record of and report to the
7-17 comptroller information relating to each [music or skill or
7-18 pleasure] coin-operated machine subject to the tax owned,
7-19 possessed, or controlled by the owner or operator [license holder],
7-20 including:
7-21 (1) the make, type, and serial number of each machine;
7-22 (2) the date each machine is placed in operation;
7-23 (3) the dates of the first and most recent
7-24 registration of each machine;
7-25 (4) the specific location of each machine; and
7-26 (5) any change in machine ownership.
7-27 (b) The comptroller may require the owner or operator to [A
8-1 license holder shall]:
8-2 (1) report to the comptroller the information required
8-3 under this section:
8-4 (A) at intervals specified by the comptroller;
8-5 and
8-6 (B) at any other time requested by the
8-7 comptroller; and
8-8 (2) immediately notify the comptroller in writing of a
8-9 change in ownership of a licensed business.
8-10 SECTION 9. Section 2153.203(a), Occupations Code, is amended
8-11 to read as follows:
8-12 (a) An owner or operator of a coin-operated machine [A
8-13 license holder] who extends or lends credit shall maintain in this
8-14 state a record of the credit transaction in accordance with
8-15 accepted accounting and auditing practices. The record must be
8-16 sufficient to enable any competent person to determine if the owner
8-17 or operator [license holder] is in compliance with the requirements
8-18 of this subchapter.
8-19 SECTION 10. Section 2153.204, Occupations Code, is amended
8-20 to read as follows:
8-21 Sec. 2153.204. REQUIRED CONTRACT PROVISION. A written
8-22 contract between an owner of a coin-operated machine [who holds a
8-23 license issued under this chapter] and an operator of a
8-24 coin-operated machine in this state must state the name, mailing
8-25 address, and telephone number of the comptroller.
8-26 SECTION 11. Sections 2153.205(a) and (b), Occupations Code,
8-27 are amended to read as follows:
9-1 (a) The first money earned from the exhibition of a
9-2 coin-operated amusement machine may be paid to the owner to
9-3 reimburse the owner for payment of:
9-4 (1) the tax imposed for that year under Subchapter D
9-5 [by Section 2153.401]; and
9-6 (2) a tax authorized by Section 2153.451 and imposed
9-7 for that year by a county or municipality.
9-8 (b) A portion of the money earned each year from the
9-9 exhibition of a coin-operated machine shall be paid to the owner in
9-10 an amount necessary to reimburse the owner for the next year's
9-11 payment of:
9-12 (1) the tax imposed by Section 2153.121 [2153.401];
9-13 and
9-14 (2) any other tax or fee imposed on the exhibition of
9-15 the machine.
9-16 SECTION 12. Subchapter F, Chapter 2153, Occupations Code, is
9-17 amended to read as follows:
9-18 SUBCHAPTER F. CREDIT TRANSACTIONS
9-19 Sec. 2153.251. RULEMAKING AUTHORITY OF COMMISSIONER. The
9-20 commissioner may adopt rules necessary to enforce this subchapter.
9-21 Sec. 2153.252. AUTHORIZED CREDIT EXTENSIONS. An owner of a
9-22 music or skill or pleasure coin-operated machine [A license holder]
9-23 may extend or lend credit to, or extend or lend credit on behalf
9-24 of, a lessee or bailee of a music or skill or pleasure
9-25 coin-operated machine only for a business or commercial purpose in
9-26 accordance with this subchapter.
9-27 Sec. 2153.253. NOTIFICATION REQUIRED. Before initially
10-1 extending or lending credit, an owner of a music or skill or
10-2 pleasure coin-operated machine [a license holder] shall notify the
10-3 commissioner of the owner's [license holder's] intent to extend or
10-4 lend credit in the conduct of the owner's [license holder's]
10-5 business.
10-6 Sec. 2153.254. WRITTEN AGREEMENT REQUIRED. An owner of a
10-7 music or skill or pleasure coin-operated machine [A license holder]
10-8 may extend or lend credit only if the credit transaction is
10-9 evidenced by a written agreement that:
10-10 (1) is signed by the parties to the agreement; and
10-11 (2) specifies the:
10-12 (A) credit amount;
10-13 (B) consideration for the credit transaction;
10-14 and
10-15 (C) terms governing repayment.
10-16 Sec. 2153.255. CONSIDERATION. (a) In this section,
10-17 "consideration" includes costs charged, contracted for, or received
10-18 by an owner of a music or skill or pleasure coin-operated machine
10-19 [a license holder] or other person in connection with
10-20 investigating, arranging, negotiating, procuring, guaranteeing,
10-21 making, servicing, collecting, or enforcing a credit transaction or
10-22 forbearance of money, credit, goods, things in action, or other
10-23 service rendered, including aggregate interest, fees, bonuses,
10-24 commissions, brokerage, discounts, and expenses. The term does not
10-25 include court costs or attorney's fees as determined by a court.
10-26 (b) The consideration for a credit transaction authorized
10-27 under Section 2153.252 may not be less than one-half percent or
11-1 exceed interest or its equivalent at the rate of one and one-half
11-2 percent per month, as determined by the United States Rule.
11-3 (c) Except as provided by Subsection (d), if the
11-4 consideration directly or indirectly charged or received by an
11-5 owner of a music or skill or pleasure coin-operated machine [a
11-6 license holder] for a credit transaction authorized under Section
11-7 2153.252 exceeds the amount of consideration permitted by
11-8 Subsection (b):
11-9 (1) the consideration paid, whether payment of
11-10 principal or interest or its equivalent, shall be refunded to the
11-11 person; and
11-12 (2) the unpaid balance of the consideration is void.
11-13 (d) Subsection (c) does not apply if consideration is
11-14 charged or collected in excess of the amount permitted by
11-15 Subsection (b) and:
11-16 (1) the overcharge or over-collection is the result
11-17 of:
11-18 (A) an accident; and
11-19 (B) a bona fide error; and
11-20 (2) the error is corrected on the date of discovery.
11-21 Sec. 2153.256. EXAMINATION; SCOPE. (a) The commissioner or
11-22 an authorized representative of the commissioner may examine a
11-23 [license holder's] place of business of an owner of a music or
11-24 skill or pleasure coin-operated machine and the owner's [license
11-25 holder's] transactions, books, accounts, papers, correspondence, or
11-26 records relating to a credit transaction authorized under Section
11-27 2153.252:
12-1 (1) when the commissioner determines that an
12-2 examination is necessary; or
12-3 (2) at the request of the attorney general or
12-4 comptroller.
12-5 (b) In conducting an examination, the commissioner or an
12-6 authorized representative of the commissioner may:
12-7 (1) freely access the office or place of business,
12-8 including a file, safe, or vault, of the owner of a music or skill
12-9 or pleasure coin-operated machine [license holder];
12-10 (2) copy the owner's [license holder's] books,
12-11 accounts, papers, correspondence, and records; and
12-12 (3) administer an oath and examine a person under oath
12-13 relating to a matter relevant to the examination.
12-14 Sec. 2153.257. FEES AND EXPENSES. (a) An owner of a music
12-15 or skill or pleasure coin-operated machine [A license holder] shall
12-16 pay to the commissioner a fee assessed by the commissioner to cover
12-17 the direct and indirect costs, including a proportionate share of
12-18 general administrative expenses, of conducting an examination under
12-19 Section 2153.256.
12-20 (b) A fee assessed by the commissioner under this section:
12-21 (1) shall be retained by the commissioner; and
12-22 (2) may not be deposited in the general revenue fund.
12-23 (c) The expenses incurred by the commissioner in conducting
12-24 an examination under Section 2153.256 may be paid only from the
12-25 fees assessed under this section and may not be charged against any
12-26 other state fund.
12-27 Sec. 2153.258. CRIMINAL OFFENSE; VIOLATION OF SUBCHAPTER.
13-1 (a) A person commits an offense if the person violates this
13-2 subchapter.
13-3 (b) An owner of a music or skill or pleasure coin-operated
13-4 machine [A license holder] commits an offense if the person fails
13-5 or refuses to comply with an examination under Section 2153.256.
13-6 (c) An offense under this section is a Class C misdemeanor.
13-7 SECTION 13. Section 2153.352(a), Occupations Code, is
13-8 amended to read as follows:
13-9 (a) The comptroller or an authorized representative of the
13-10 comptroller may seal a coin-operated machine in a manner that
13-11 prevents the full operation of the machine if[:]
13-12 [(1) the license or registration certificate of the
13-13 person exhibiting or displaying the machine is suspended or
13-14 revoked;]
13-15 [(2)] the owner fails to pay a tax on the machine[; or]
13-16 [(3) the machine is not registered with the
13-17 comptroller under this chapter].
13-18 SECTION 14. Section 2153.354(a), Occupations Code, is
13-19 amended to read as follows:
13-20 (a) The comptroller may assess a penalty of not less than
13-21 $50 or more than $2,000 against:
13-22 (1) an owner who permits a coin-operated machine under
13-23 the owner's control to be operated, exhibited, or displayed in this
13-24 state without a tax permit as required by Section 2153.126
13-25 [2153.406]; or
13-26 (2) a person who:
13-27 (A) exhibits or displays a coin-operated machine
14-1 in this state without a tax permit as required by Section 2153.126
14-2 [2153.406];
14-3 (B) [exhibits or displays a coin-operated
14-4 machine that is not registered;]
14-5 [(C)] does not maintain the records required by
14-6 the comptroller under this chapter;
14-7 (C) [(D)] refuses or fails to make records
14-8 available for inspection on request by the comptroller or an
14-9 authorized representative of the comptroller;
14-10 (D) [(E)] uses an artful device or deceptive
14-11 practice to conceal a violation of this chapter;
14-12 (E) [(F)] misleads the comptroller or an
14-13 authorized representative of the comptroller in connection with the
14-14 enforcement of this chapter; or
14-15 (F) [(G)] violates this chapter or a rule
14-16 adopted under this chapter.
14-17 SECTION 15. Section 2153.451(b), Occupations Code, is
14-18 amended to read as follows:
14-19 (b) The rate of the tax may not exceed one-fourth of the
14-20 rate of the tax imposed under Section 2153.121 [2153.401].
14-21 SECTION 16. (a) Sections 2153.007, 2153.008, 2153.101,
14-22 2153.151, 2153.152, 2153.153, 2153.154, 2153.155, 2153.156,
14-23 2153.157, 2153.158, 2153.159, 2153.160, 2153.161, 2153.162,
14-24 2153.163, 2153.205(d), 2153.351, 2153.353, 2153.356, 2153.357, and
14-25 2153.406(d), Occupations Code, are repealed.
14-26 (b) Subchapter G, Chapter 2153, Occupations Code, is
14-27 repealed.
15-1 SECTION 17. This Act takes effect September 1, 2001.