78S40070 CBH-F
By: Griggs H.B. No. 5
A BILL TO BE ENTITLED
AN ACT
relating to increases in the tax on cigarettes and other tobacco
products and to the allocation of those increases.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 154.021(b), Tax Code, is amended to read
as follows:
(b) The tax rates are:
(1) $70.50 [$20.50] per thousand on cigarettes
weighing three pounds or less per thousand; and
(2) the rate provided by Subdivision (1) plus $2.10
per thousand on cigarettes weighing more than three pounds per
thousand.
SECTION 2. Section 154.603, Tax Code, is amended to read as
follows:
Sec. 154.603. DISPOSITION OF REVENUE. (a) After the
deductions for the purposes provided by Section 154.602 [of this
code], the revenue remaining of the first $2 of tax received per
1,000 cigarettes for cigarettes weighing three pounds or less per
thousand and the first $4.10 per 1,000 cigarettes of the tax
received for cigarettes weighing more than three pounds per
thousand is allocated:
(1) 18.75 percent to the foundation school fund; and
(2) 81.25 percent to the general revenue fund.
(b) The revenue remaining after the deductions for the
purposes provided by Section 154.602 [of this code] and allocation
under Subsection (a) of the next $18.50 of tax received per 1,000
cigarettes for cigarettes weighing three pounds or less per
thousand and the next $18.50 per 1,000 cigarettes of the tax
received for cigarettes weighing more than three pounds per
thousand [this section] is allocated to the general revenue fund.
(c) The revenue remaining after the deductions for the
purposes provided by Section 154.602 and allocation under
Subsections (a) and (b) shall be deposited as follows:
(1) the next $2.50 of tax received per 1,000
cigarettes weighing three pounds or less per thousand and the next
$2.50 per 1,000 cigarettes of the tax received for cigarettes
weighing more than three pounds per thousand shall be deposited to
the credit of the tobacco cessation account in the general revenue
fund and may be appropriated only to the Texas Department of Health
to provide grants to one or more national nonprofit organizations
for programs to reduce the use of cigarettes and tobacco products in
this state; and
(2) the remaining revenue shall be deposited to the
foundation school fund.
SECTION 3. Section 155.021(b), Tax Code, is amended to read
as follows:
(b) The tax rates are:
(1) 3.44 cents [one cent] per 10 or fraction of 10 on
cigars weighing three pounds or less per thousand;
(2) $25.80 [$7.50] per thousand on cigars that:
(A) weigh more than three pounds per thousand;
and
(B) sell at factory list price, exclusive of any
trade discount, special discount, or deal, for 3.3 cents or less
each;
(3) $37.84 [$11] per thousand on cigars that:
(A) weigh more than three pounds per thousand;
(B) sell at factory list price, exclusive of any
trade discount, special discount, or deal, for more than 3.3 cents
each; and
(C) contain no substantial amount of nontobacco
ingredients; and
(4) $51.60 [$15] per thousand on cigars that:
(A) weigh more than three pounds per thousand;
(B) sell at factory list price, exclusive of any
trade discount, special discount, or deal, for more than 3.3 cents
each; and
(C) contain a substantial amount of nontobacco
ingredients.
SECTION 4. Section 155.0211(b), Tax Code, is amended to
read as follows:
(b) The tax rate for tobacco products other than cigars is
121 [35.213] percent of the manufacturer's list price, exclusive of
any trade discount, special discount, or deal.
SECTION 5. Section 155.241, Tax Code, is amended to read as
follows:
Sec. 155.241. ALLOCATION OF TAX. (a) Revenue collected
under this chapter at the following rates shall be deposited to the
credit of the general revenue fund:
(1) the revenue from the first one cent per 10 or
fraction of 10 on cigars weighing three pounds or less per thousand;
(2) the revenue from the first $7.50 per thousand on
cigars that:
(A) weigh more than three pounds per thousand;
and
(B) sell at factory list price, exclusive of any
trade discount, special discount, or deal, for 3.3 cents or less
each;
(3) the revenue from the first $11 per thousand on
cigars that:
(A) weigh more than three pounds per thousand;
(B) sell at factory list price, exclusive of any
trade discount, special discount, or deal, for more than 3.3 cents
each; and
(C) contain no substantial amount of nontobacco
ingredients;
(4) the revenue from the first $15 per thousand on
cigars that:
(A) weigh more than three pounds per thousand;
(B) sell at factory list price, exclusive of any
trade discount, special discount, or deal, for more than 3.3 cents
each; and
(C) contain a substantial amount of nontobacco
ingredients; and
(5) the revenue from the tax on tobacco products other
than cigars imposed at the rate of 35.213 percent of the
manufacturer's list price, exclusive of any trade discount, special
discount, or deal.
(b) The revenue remaining after the allocation under
Subsection (a) shall be deposited to the credit of the foundation
school fund.
SECTION 6. This Act takes effect September 1, 2004.