LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 77th Regular Session
May 9, 2001
TO: Honorable Rodney Ellis, Chair, Senate Committee on Finance
FROM: John Keel, Director, Legislative Budget Board
IN RE: HB939 by Hodge (Relating to the application of certain
taxes on persons involved in television, motion picture,
video, and audio productions.), As Engrossed
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* Estimated Two-year Net Impact to General Revenue Related Funds for *
* HB939, As Engrossed: a negative impact of $(1,157,417) through the *
* biennium ending August 31, 2003, if the effective date of the bill *
* is July 1, 2001; and a negative impact of $(1,025,750) through the *
* biennium ending August 31, 2003, if the effective date of the bill *
* is October 1, 2001. *
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The following table assumes an effective date of July 1, 2001.
All Funds, Five-Year Impact:
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*Fiscal Probable Probable Probable Probable *
* Year Revenue Revenue Revenue Revenue *
* Gain/(Loss) to Gain/(Loss) Gain/(Loss) Gain/(Loss) *
* General Revenue from Hotel from Cities from Counties *
* Fund Occupancy Tax *
* 0001 Deposits *
* Account *
* 5003 *
* 2001 $(78,250) $(750) $(9,000) $(1,000) *
* 2002 (532,667) (9,333) (114,000) (9,000) *
* 2003 (546,500) (9,500) (117,000) (9,000) *
* 2004 (561,167) (9,833) (120,000) (9,000) *
* 2005 (575,917) (10,083) (123,000) (10,000) *
* 2006 (590,667) (10,333) (126,000) (10,000) *
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The following table assumes an effective date of October 1, 2001.
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*Fiscal Probable Probable Probable Probable *
* Year Revenue Revenue Revenue Revenue *
* Gain/(Loss) to Gain/(Loss) Gain/(Loss) Gain/(Loss) *
* General Revenue from Hotel from Cities from Counties *
* Fund Occupancy Tax *
* 0001 Deposits *
* Account *
* 5003 *
* 2002 $(479,250) $(7,750) $(95,000) $(7,000) *
* 2003 (546,500) (9,500) (117,000) (9,000) *
* 2004 (561,167) (9,833) (120,000) (9,000) *
* 2005 (575,917) (10,083) (123,000) (10,000) *
* 2006 (590,667) (10,333) (126,000) (10,000) *
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Fiscal Analysis
The bill would exempt certain items involved in television, motion
pictures, video, and audio production from the taxes imposed by Chapters
152 and 156 of the Tax Code.
The bill would amend Chapter 152 to exempt from the motor vehicle sales
and use tax the purchase, rental, or use of a motor vehicle used
exclusively in connection with the commercial production of a television
film, commercial, program, motion picture, or a video or audio recording.
The tax that would have been remitted on the gross rental receipts
without this exemption would be deemed to have been remitted for the
purpose of computing the minimum gross rental receipts tax.
The bill would amend Chapter 156 to exempt from the hotel occupancy tax a
person involved in the commercial production of a television film,
commercial, program, motion picture, or a video or audio recording,
provided that the person had the right to use or possess a room in one
hotel or in a series of two or more hotels for at least 15 consecutive
days.
The bill would take effect July 1, 2001, assuming that it received the
requisite two-thirds majority votes in both houses of the Legislature.
Otherwise, it would take effect October 1, 2001.
Methodology
Data were collected from public and private sources, including the Texas
Film Commission. Motor vehicle rentals were estimated as a percentage
of production budgets and extrapolated using the Consumer Price Index.
For the hotel occupancy tax exemption, the state tax rate was applied to
the estimated budget for lodging by commercial production companies
meeting the 15-day minimum stay requirement. The fiscal impacts for
years after 2000 were adjusted using the Consumer Price Index.
Local Government Impact
Local units of government would have a corresponding fiscal impact from
sales tax revenues, as indicated in the table above.
Source Agencies: 304 Comptroller of Public Accounts
LBB Staff: JK, SD, SM