By George H.B. No. 3573 Line and page numbers may not match official copy. Bill not drafted by TLC or Senate E&E. A BILL TO BE ENTITLED 1-1 AN ACT 1-2 relating to exempting certain purchases and leases of machinery and 1-3 equipment used by certain companies for research and development 1-4 from sales and use taxes. 1-5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-6 SECTION 1. Subchapter H, Chapter 151, Tax Code, is amended by 1-7 adding Section 151.3181 to read as follows: 1-8 Sec. 151.3181. EQUIPMENT USED IN RESEARCH OR DEVELOPMENT. 1-9 (a) There are exempted from the taxes imposed by this chapter the 1-10 purchase or lease of machinery, equipment, or replacement parts 1-11 that are used directly in the research or development of 1-12 biotechnology or nanotechnology inventions, products, or processes. 1-13 (b) The exemption does not include: 1-14 (1) office equipment or supplies; or 1-15 (2) equipment or supplies used in sales or 1-16 distribution activities or in transportation activities. 1-17 (c) In this section, "manufacturing" has the meaning 1-18 assigned by Section 151.318. 1-19 SECTION 2. (a) This Act takes effect October 1, 2001. 1-20 (b) The change in law made by this Act does not affect taxes 1-21 imposed before the effective date of this Act, and the law in 1-22 effect before the effective date of this Act is continued in effect 1-23 for purposes of the liability for and collection of those taxes.