TO: | Honorable Ron Wilson, Chair, House Committee on Ways & Means |
FROM: | John Keel, Director, Legislative Budget Board |
IN RE: | HB308 by Denny (Relating to exempting school supplies, textbooks, books, and other instructional materials from the sales tax for a limited period.), As Introduced |
The following table assumes an effective date of July 1, 2003.
Fiscal Year | Probable Revenue Gain/(Loss) fromGENERAL REVENUE FUND 1 |
Probable Revenue Gain/(Loss) fromCities | Probable Revenue Gain/(Loss) fromTransit Authorities | Probable Revenue Gain/(Loss) fromCounties/Special Districts |
---|---|---|---|---|
2003 | ($6,003,000) | $0 | $0 | $0 |
2004 | ($17,727,000) | ($3,261,000) | ($1,175,000) | ($408,000) |
2005 | ($18,910,000) | ($3,480,000) | ($1,254,000) | ($434,000) |
2006 | ($20,164,000) | ($3,711,000) | ($1,337,000) | ($463,000) |
2007 | ($21,482,000) | ($3,953,000) | ($1,424,000) | ($494,000) |
2008 | ($22,911,000) | ($4,216,000) | ($1,520,000) | ($527,000) |
The following table assumes an effective date of October 1, 2003.
Fiscal Year | Probable Revenue Gain/(Loss) fromGENERAL REVENUE FUND 1 |
Probable Revenue Gain/(Loss) fromCities | Probable Revenue Gain/(Loss) fromTransit Authorities | Probable Revenue Gain/(Loss) fromCounties/Special Districts |
---|---|---|---|---|
2004 | ($6,440,000) | $0 | $0 | $0 |
2005 | ($18,910,000) | ($3,480,000) | ($1,254,000) | ($434,000) |
2006 | ($20,164,000) | ($3,711,000) | ($1,337,000) | ($463,000) |
2007 | ($21,482,000) | ($3,953,000) | ($1,424,000) | ($494,000) |
2008 | ($22,911,000) | ($4,216,000) | ($1,520,000) | ($527,000) |
The bill would amend Chapter 151 of the Tax Code to exempt certain school supplies from the limited sales and use tax if the items were required for classroom use by a student in a public or private elementary or secondary school, had a value of less than $100, and were purchased during the three-day sales tax holiday on clothing and footwear each August.
A retailer would not have to obtain an exemption certificate except in instances where the quantity purchased would indicate a non-school usage.
The bill would take effect July 1, 2003, assuming that it received the requisite two-thirds majority votes in both houses of the Legislature. Otherwise, it would take effect October 1, 2003.
Data on the sale of school supplies (including backpacks) and textbooks were obtained from a variety of sources, both public and private, including the U.S. Census Bureau. The data were adjusted for the appropriate price range and time period, multiplied by the state sales tax rate, adjusted for the potential effective dates of July 1, 2003 and October 1, 2003, and extrapolated through fiscal 2008. The fiscal impacts on units of local government were estimated proportionally.
Note: This analysis assumes that a portion of the sale tax generated by college textbooks would be exempted by this bill, as well as a portion of the sales tax collected on books sold at non-college, public bookstores.
Source Agencies: | 304 Comptroller of Public Accounts
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LBB Staff: | JK, JO, SD, WP, SM
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