LEGISLATIVE BUDGET BOARD
Austin, Texas
 
FISCAL NOTE, 78TH LEGISLATIVE REGULAR SESSION
 
April 28, 2003

TO:
Honorable Ron Wilson, Chair, House Committee on Ways & Means
 
FROM:
John Keel, Director, Legislative Budget Board
 
IN RE:
HB184 by Merritt (Relating to the application of the sales tax to United States and Texas flags.), As Introduced



Estimated Two-year Net Impact to General Revenue Related Funds for HB184, As Introduced: a negative impact of ($1,314,000) through the biennium ending August 31, 2005.



Fiscal Year Probable Net Positive/(Negative) Impact to General Revenue Related Funds
2004 ($588,000)
2005 ($726,000)
2006 ($745,000)
2007 ($764,000)
2008 ($783,000)




Fiscal Year Probable Revenue Gain/(Loss) from
GENERAL REVENUE FUND
1 		Probable Revenue Gain/(Loss) from
Cities		 Probable Revenue Gain/(Loss) from
Transit Authorities		 Probable Revenue Gain/(Loss) from
Counties/Special Districts
2004 ($588,000) ($97,000) ($35,000) ($12,000)
2005 ($726,000) ($134,000) ($48,000) ($17,000)
2006 ($745,000) ($137,000) ($49,000) ($17,000)
2007 ($764,000) ($141,000) ($51,000) ($18,000)
2008 ($783,000) ($144,000) ($52,000) ($18,000)

Fiscal Analysis

The bill would amend Chapter 151 of the Tax Code to exempt the sale of the flag of the United States or the flag of the State of Texas from the sales tax.

The bill would take effect October 1, 2003.


Methodology

Data on the sale of flags were gathered from the U.S. Census Bureau. The data were adjusted to reflect sales of United States and Texas flags in Texas and multiplied by the tax rate. The result was adjusted for an effective date of October 1, 2003 and extrapolated through 2008. The fiscal impact on units of local government were estimated proportionally.

Local Government Impact

Local units of government would have a corresponding fiscal impact from sales tax revenues, as indicated in the above table.


Source Agencies:
304 Comptroller of Public Accounts
LBB Staff:
JK, JO, SD, WP, SM