By: Keffer of Eastland H.B. No. 2234
A BILL TO BE ENTITLED
AN ACT
relating to taxes, fees, and programs administered by the
Comptroller.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 161.081, Health and Safety Code, is
amended to read as follows:
(1) "Attempt" means committing an act amounting to
more than mere preparation that tends but fails to effect the
commission of the offense intended.
(2) [(1)] "Cigarette" has the meaning assigned by
Section 154.001, Tax Code.
(3) [(2)] "Permit holder" has the meaning assigned by
Section 154.001 or 155.001, Tax Code, as applicable.
(4) [(3)] "Retail sale" means a transfer of possession
from a retailer to a consumer in connection with a purchase, sale,
or exchange for value of cigarettes or tobacco products.
(5) [(4)] "Retailer" has the meaning assigned by
Section 154.001 or 155.001, Tax Code, as applicable.
(6) [(5)] "Tobacco product" has the meaning assigned
by Section 155.001, Tax Code.
(7) [(6)] "Wholesaler" has the meaning assigned by
Section 154.001 or 155.001, Tax Code, as applicable.
SECTION 2. Subchapter H, Chapter 161, Health and Safety
Code, is amended by adding Section 161.0821 to read as follows:
Sec. 161.0821. PURCHASE OF CIGARETTES OR TOBACCO PRODUCTS
BY PERSONS YOUNGER THAN 18 YEARS OF AGE PROHIBITED. (a) A person
who is younger than 18 years of age commits an offense if the person
purchases or attempts to purchase cigarettes or tobacco products.
(b) An offense under this section is a Class C misdemeanor.
SECTION 3. Subsection (a) of Section 285.063, Health and
Safety Code, is amended to read as follows:
(a) The adoption or abolition of the tax or change in the tax
rate takes effect on the first day of the first calendar quarter
occurring after the expiration of the first complete calendar
quarter occurring after the date on which the comptroller receives
a notice of the results of the election. Following an election to
adopt the tax under this section, the district must submit to the
comptroller a description of the boundaries of the district and a
map of the district clearly showing the district's boundaries at
the same time it submits the results of the election held as
provided by this chapter.
SECTION 4. Section 775.0753, Health and Safety Code, is
amended by adding Subsection (d) to read as follows:
(d) The district must submit to the comptroller a
description of the boundaries of the district and a map of the
district clearly showing the district's boundaries at the same time
it submits the results of the election held as provided by this
chapter.
SECTION 5. Section 776.0753, Health and Safety Code, is
amended by adding Subsection (d) to read as follows:
(d) The district must submit to the comptroller a
description of the boundaries of the district and a map of the
district clearly showing the district's boundaries at the same time
it submits the results of the election held as provided by this
chapter.
SECTION 6. Article 1.16(b), Insurance Code, is amended to
read as follows:
(b) Assessments for the expenses of such domestic
examination which shall be sufficient to meet all the expenses and
disbursements necessary to comply with the provisions of the laws
of Texas relating to the examination of insurance companies and to
comply with the provisions of this Article and Articles 1.17 and
1.18 of this Code, shall be made by the State Board of Insurance
upon the corporations or associations to be examined taking into
consideration annual premium receipts, and/or admitted assets that
are not attributable to 90 percent of pension plan contracts as
defined in Section 818(a) of the Internal Revenue Code of 1986 (26
U.S.C. Section 818(a)), and/or insurance in force;
provided such assessments shall be made and collected as follows:
(1) expenses attributable directly to a specific examination
including employees' salaries and expenses and expenses provided by
Article 1.28 of this Code shall be collected at the time of
examination; (2) assessments calculated annually for each
corporation or association which take into consideration annual
premium receipts, and/or admitted assets that are not attributable
to 90 percent of pension plan contracts as defined in Section 818(a)
of the Internal Revenue Code of 1986 (26 U.S.C. Section 818(a)),
and/or insurance in force shall be assessed annually for each such
corporation or association. In computing the assessments, the
board may not consider insurance premiums for insurance contracted
for by a state or federal governmental entity to provide welfare
benefits to designated welfare recipients or contracted for in
accordance with or in furtherance of Title 2, Human Resources Code,
or the federal Social Security Act (42 U.S.C. Section 301 et seq.).
The amount of all examination and evaluation fees paid in each
taxable year to the State of Texas by an insurance carrier shall be
allowed as a credit on the amount of premium taxes due [under this
article]. The limitations provided by Sections 803.007(1) and
(2)(B) of this code for domestic insurance companies apply to
foreign insurance companies.
SECTION 7. Sections 221.002(b) and (c), Insurance Code, are
amended to read as follows:
(b) Except as provided by Subsection (c), in determining an
insurer's taxable premiums [premium receipts], the insurer shall
include the total gross amounts of premiums, membership fees,
assessments, dues, revenues, and any other considerations on
insurance written by the insurer in a calendar year from any kind of
insurance written on each and every kind of property or risks
located in this state, including:
(1) fire insurance;
(2) ocean marine insurance;
(3) inland marine insurance;
(4) accident insurance;
(5) credit insurance;
(6) livestock insurance;
(7) fidelity insurance;
(8) guaranty insurance;
(9) surety insurance;
(10) casualty insurance;
(11) workers' compensation insurance;
(12) employers' liability insurance; [and]
(13) crop insurance written by a farm mutual insurance
company; and
(14) home warranty insurance.
(c) The following premium receipts are not included in
determining an insurer's taxable premium receipts:
(1) premium receipts received from the business of
title insurance;
(2) premium receipts received from the business of
life insurance, personal accident insurance, life and accident
insurance, or health and accident insurance for profit, written by
a life insurance company, life and accident insurance company,
health and accident insurance company, or for mutual benefit or
protection in this state;
(3) premium receipts received from another authorized
insurer for reinsurance;
(4) returned premiums and dividends paid to
policyholders; [and]
(5) premiums excluded by another law of this state;
and
(6) premium finance charges clearly identified in a
premium note or other evidence of premiums payable that are
separately stated to the policyholder in an invoice, billing or
contract.
SECTION 8. Section 222.002(b), Insurance Code, is amended
to read as follows:
(b) Except as otherwise provided by this section, in
determining an insurer's taxable gross premiums or a health
maintenance organization's taxable gross revenues, the insurer or
health maintenance organization shall include the total gross
amounts of premiums, membership fees, assessments, dues, revenues,
and other considerations received by the insurer or health
maintenance organization in a calendar year from any kind of health
maintenance organization certificate or contract or insurance
policy or contract covering risks on individuals or groups [a
person] located in this state and arising from the business of a
health maintenance organization or the business of life insurance,
accident insurance, health insurance, life and accident insurance,
life and health insurance, health and accident insurance, life,
health, and accident insurance, including variable life insurance,
credit life insurance, and credit accident and health insurance for
profit or otherwise or for mutual benefit or protection.
SECTION 9. Section 223.003(a), Insurance Code, is amended
to read as follows:
(a) An annual tax is imposed on all [each title insurance
company that receives] premiums from the business of title
insurance. The rate of the tax is 1.35 percent of [the] title
insurance [company's] taxable premiums for a calendar year,
including any premiums retained by a title insurance agent as
provided by Section 223.005. For purposes of this chapter, a person
engages in the business of title insurance if the person engages in
an activity described by Section 2501.005.
SECTION 10. Section 252.003, Insurance Code is amended to
read as follows:
Sec. 252.003. PREMIUMS SUBJECT TO TAXATION. An insurer
shall pay maintenance taxes under this chapter on the correctly
reported gross premiums [collected] from writing insurance in this
state against loss or damage by:
(1) bombardment;
(2) civil war or commotion;
(3) cyclone;
(4) earthquake;
(5) excess or deficiency of moisture;
(6) explosion as defined by Article 5.52;
(7) fire;
(8) flood;
(9) frost and freeze;
(10) hail;
(11) insurrection;
(12) invasion;
(13) lightning;
(14) military or usurped power;
(15) an order of a civil authority made to prevent the
spread of a conflagration, epidemic, or catastrophe;
(16) rain;
(17) riot;
(18) the rising of the waters of the ocean or its
tributaries;
(19) smoke or smudge;
(20) strike or lockout;
(21) tornado;
(22) vandalism or malicious mischief;
(23) volcanic eruption;
(24) water or other fluid or substance resulting from
the breakage or leakage of sprinklers, pumps, or other apparatus
erected for extinguishing fires, water pipes, or other conduits or
containers;
(25) weather or climatic conditions; [or]
(26) windstorm;
(27) an event covered under a home warranty insurance
policy; or
(28) an event covered under an inland marine insurance
policy.
SECTION 11. Section 271.002(a), Insurance Code, is amended
to read as follows:
(a) A maintenance fee is imposed on all [each insurer with
gross] premiums subject to assessment under Section 271.006.
SECTION 12. Section 1502.053, Insurance Code, is amended to
read as follows:
Section 1502.053. EXEMPTION FROM CERTAIN TAXES. (a) A
children's health benefit plan issuer is not subject to the premium
tax or the tax on revenues imposed under Chapter 222 with respect to
money received for coverage provided under that plan.
(b) A children's health benefit plan issuer is not subject
to the retaliatory tax imposed under Chapter 281 with respect to
money received for coverage provided under that plan.
SECTION 13. Section 383.101, Local Government Code, is
amended by adding Subsection (d) to read as follows:
(d) The district must submit to the comptroller a
description of the boundaries of the district and a map of the
district clearly showing the district's boundaries at the same time
it submits the results of the election held as provided by this
chapter.
SECTION 14. Section 387.012, Local Government Code, is
amended to read as follows:
Section 387.012. EFFECTIVE DATE OF TAX. (a) The adoption
of the tax, the change of the tax rate, or the repeal of the tax
takes effect on the first day of the first calendar quarter
occurring after the expiration of the first complete quarter
occurring after the date the comptroller receives a notice of the
results of the election adopting, changing, or repealing the tax.
(b) The district must submit to the comptroller a
description of the boundaries of the district and a map of the
district clearly showing the district's boundaries at the same time
it submits the results of the election held as provided by this
chapter.
SECTION 15. Section 111.009, Tax Code, is amended by
amending subsection (a) and adding new subsections (e) and (f), to
read as follows:
(a) A person having a direct interest in a determination may
petition the comptroller for a redetermination and may assert legal
and factual grounds to challenge the assessment.
(e) The person filing the petition may assert credits or
claim a refund for the same tax type and same period to offset the
assessment. Any credits asserted or refund claimed must be
included in the petition or must be filed within the applicable
limitations period, except as otherwise provided by this section.
The comptroller shall promulgate procedural rules that ensure that
redetermination proceedings are expeditiously finalized and that
provide that all parties receive equal time to prepare and submit
their positions prior to the hearing.
(f) A credit or refund for the same tax type and same period
may be filed in the redetermination proceeding for all issues if the
credit is asserted or the refund is claimed within one (1) year from
the date of filing of the petition for redetermination. This
provision does not authorize the filing of a separate refund or
credit that is not authorized by Section 111.107(b).
SECTION 16. Section 111.010, Tax Code, is amended by adding
Subsection (e) to read as follows:
(e) A judgment in a suit arising under this section remains
valid and enforceable until satisfied and does not require periodic
renewal. The provisions of Section 34.001, Civil Practice and
Remedies Code, shall not apply to a judgment in a suit arising under
this section.
SECTION 17. Section 111.016, Tax Code, is amended by adding
Subsection (e) to read as follows:
(e) The Comptroller may assess the responsible individual
liable under subsection(b) of this section at any time before the
expiration of one year after the later of the date the tax liability
of the corporation, association, limited liability company,
limited partnership or other legal entity becomes final or the date
the bankruptcy proceeding is closed or dismissed.
SECTION 18. Subchapter B, Chapter 111, Tax Code, is amended
by adding Section 111.0511 to read as follows:
Sec. 111.0511. RESTRICTED OR CONDITIONAL PAYMENTS OF TAXES,
PENALTIES, AND INTEREST PROHIBITED. Unless the restriction or
condition is authorized by this title, a restriction or condition
placed on a check in payment of taxes by the maker that purports to
limit the amount of taxes owed to an amount less than that stated in
the comptroller's records, or a restriction or condition placed on
a check in payment of penalties and interest on delinquent taxes by
the maker that purports to limit the amount of the penalties and
interest to an amount less than the amount of penalties and interest
accrued on the delinquent taxes, is void.
SECTION 19. Section 111.0625. Tax Code, is amended to read
as follows:
Section 111.0625. ELECTRONIC TRANSFER OF CERTAIN PAYMENTS.
(a) The comptroller by rule shall require a taxpayer who paid
$100,000 or more during the preceding fiscal year in a category of
payments required under this title to transfer payments in that
category by means of electronic funds transfer in accordance with
Section 404.095, Government Code, if the comptroller reasonably
anticipates the person will pay at least that amount during the
current fiscal year.
(b) The comptroller may by rule reduce the amount provided
in subsection (a) of this section to $50,000 or more.
SECTION 20. Section 111.107(a), Tax Code, is amended to
read as follows:
(a) Except as otherwise expressly provided, a person may
request a refund or a credit or the comptroller may make a refund or
issue a credit for the overpayment of a tax imposed by this title at
any time before the expiration of the period during which the
comptroller may assess a deficiency for the tax and not thereafter
unless the refund or credit is requested:
(1) under Subchapter B of Chapter 112 and the refund is
made or the credit is issued under a court order;
(2) under the provision of Section 111.104(c)(3)
applicable to a refund claim filed after a jeopardy or deficiency
determination becomes final; or
(3) under Chapter 162 [153], except Section 162.126(f)
[153.1195(e)], 162.128(d) [153.121(d)], 162.228(f) [153.2225(e)],
or 162.230(d) [153.224(d)].
SECTION 21. Section 151.006, Tax Code, is amended to read as
follows:
Sec. 151.006. SALE FOR RESALE. "Sale for resale" means a
sale of:
(1) tangible personal property or a taxable service to
a purchaser who acquires the property or service for the purpose of
reselling it in the United States of America or a possession or
territory of the United States of America or in the United Mexican
States in the normal course of business in the form or condition in
which it is acquired or as an attachment to or integral part of
other tangible personal property or taxable service;
(2) tangible personal property to a purchaser for the
sole purpose of the purchaser's leasing or renting it in the United
States of America or a possession or territory of the United States
of America or in the United Mexican States in the normal course of
business to another person, but not if incidental to the leasing or
renting of real estate;
(3) tangible personal property to a purchaser who
acquires the property for the purpose of transferring it in the
United States of America or a possession or territory of the United
States of America or in the United Mexican States as an integral
part of a taxable service; or
(4) a taxable service performed on tangible personal
property that is held for sale by the purchaser of the taxable
service.
SECTION 22. Section 151.011(a), Tax Code, is amended to
read as follows:
(a) Except as provided by Subsection (c) of this section,
"use" means the exercise of a right or power incidental to the
ownership of tangible personal property over tangible personal
property, including tangible personal property other than printing
[printed] material that has been processed, fabricated, or
manufactured into other property or attached to or incorporated
into other property transported into this state, and, except as
provided by Section 151.056(b) of this code, includes the
incorporation of tangible personal property into real estate or
into improvements of real estate whether or not the real estate is
subsequently sold.
SECTION 23. Section 151.3111(b), Tax Code, is amended to
read as follows:
(b) Subsection (a) does not apply to the performance of a
service on:
(1) tangible personal property that would be exempted
solely because of the exempt status of the seller of the property;
(2) tangible personal property that is exempted solely
because of the application of Section 151.303, 151.304, or 151.306;
(3) motor vehicles, trailers, or semitrailers as
defined, taxed, or exempted by Chapter 152; [or]
(4) a taxable boat or motor as defined by Section
160.001;[.]
(5) [(6)] tangible [Tangible] personal property
exempt under Section 151.326; or
(6) through December 31, 2007, tangible personal
property that is exempted solely because of the application of
Section 151.3162.
SECTION 24. Section 151.3162(d), Tax Code, is amended to
read as follows:
(d) The exemption provided by Subsection (b) takes effect
January 1, 2008. Until that date, a person is entitled to an
exemption [a credit or refund] of a portion of the taxes paid under
this chapter on an item that after January 1, 2008, will be exempted
from the taxes imposed by this chapter under Subsection (b).
SECTION 25. Subsection (c)(1) of Section 151.318, Tax Code,
is amended to read as follows:
(c) The exemption does not include:
(1) intraplant transportation equipment, including
intraplant transportation equipment used to move a product or raw
material in connection with the manufacturing process and
specifically including all piping and conveyor systems, provided
that the following remain eligible for the exemption:
(A) piping or conveyor systems that are a
component part of a single item of manufacturing equipment or
pollution control equipment eligible for the exemption under
Subsection (a)(2), (a)(4), or (a)(5);
(B) piping or conveyor systems through which the
product or an intermediate or preliminary product that will become
an ingredient or component part of the product is recycled or
circulated in a loop between the single item of manufacturing
equipment and the ancillary equipment that supports only that
single item of manufacturing equipment if the single item of
manufacturing equipment and the ancillary equipment operate
together to perform a specific step in the manufacturing process;
and
(C) piping or conveyor systems through which the
product or an intermediate or preliminary product that will become
an ingredient or component part of the product is recycled back to
another single item of manufacturing equipment and its ancillary
equipment in the same manufacturing process;
(2) hand tools;
(3) maintenance supplies not otherwise exempted under
this section, maintenance equipment, janitorial supplies or
equipment, office equipment or supplies, equipment or supplies used
in sales or distribution activities, research or development of new
products, or transportation activities;
(4) machinery and equipment or supplies to the extent
not otherwise exempted under this section used to maintain or store
tangible personal property; or
(5) tangible personal property used in the
transmission or distribution of electricity, including
transformers, cable, switches, breakers, capacitor banks,
regulators, relays, reclosers, fuses, interruptors, reactors,
arrestors, resistors, insulators, instrument transformers, and
telemetry units not otherwise exempted under this section, and
lines, conduit, towers, and poles.
SECTION 26. Sec. 154.111(b), Tax Code, is amended to read
as follows:
(b) An application for a permit required by this chapter
must be accompanied by a fee of:
(1) $300 for a bonded agent's permit;
(2) $300 for a distributor's permit;
(3) $200 for a wholesaler's permit;
(4) $15 for each permit for a vehicle if the applicant
is also applying for a permit as a bonded agent, distributor, or
wholesaler or has received a current permit from the comptroller
under Sections 154.101 and 154.110; [and]
(5) $180 for a retailer's permit; and
(6) $300 for a manufacturer's permit.
SECTION 27. Section 154.509, Tax Code, is amended to read as
follows:
Sec. 154.509. PERMITS. A person commits an offense if the
person:
(1) as a manufacturer, distributor, bonded agent,
importer, wholesaler, or retailer, receives or possesses
cigarettes without having a valid permit;
(2) as a manufacturer, distributor, bonded agent,
importer, wholesaler, or retailer, receives or possesses
cigarettes without having a permit posted where it can be easily
seen by the public;
(3) as a distributor or wholesaler, does not deliver
an invoice to the purchaser as required by Section 154.203;
(4) as a manufacturer, distributor, bonded agent,
importer, wholesaler, or retailer, sells cigarettes without having
a valid permit; or
(5) as a manufacturer, bonded agent, or importer,
stores, distributes, or delivers cigarettes in unstamped packages
without having a valid permit.
SECTION 28. Section 155.049(b), Tax Code, is amended to
read as follows:
(b) An application for a permit required by this chapter
must be accompanied by a fee of:
(1) $300 for a bonded agent's permit;
(2) $300 for a distributor's permit;
(3) $200 for a wholesaler's permit;
(4) $15 for each permit for a vehicle if the applicant
is also applying for a permit as a bonded agent, distributor, or
wholesaler or has received a current permit from the comptroller
under Sections 155.041 and 155.048; [and]
(5) $180 for a retailer's permit; and
(6) $300 for a manufacturer's permit.
SECTION 29. Section 155.207, Tax Code, is amended to read as
follows:
Sec. 155.207. PERMITS. A person commits an offense if the
person:
(1) as a manufacturer, distributor, bonded agent,
importer, wholesaler, or retailer, receives or possesses tobacco
products without having a valid permit;
(2) as a manufacturer, distributor, bonded agent,
importer, wholesaler, or retailer, receives or possesses tobacco
products without having a permit posted where it can be easily seen
by the public;
(3) as a distributor or wholesaler, does not deliver
an invoice to the purchaser as required by Section 155.102;
(4) as a manufacturer, distributor, bonded agent,
importer, wholesaler, or retailer, sells tobacco products without
having a valid permit; or
(5) as a manufacturer, bonded agent, or importer,
stores, distributes, or delivers tobacco products on which the tax
has not been paid without having a valid permit.
SECTION 30. Section 156.051(b), Tax Code, is amended to
read as follows:
(b) The price of a room or space in a hotel does not include
the cost of food served by the hotel and the cost of personal
services performed by the hotel for the person except for those
services related to cleaning and readying the room or space for use
or possession.
SECTION 31. Section 156.052, Tax Code, is amended to read as
follows:
Sec. 156.052. RATE OF TAX. The rate of the tax imposed by
this chapter is six percent of the price paid for a room or space in
a hotel.
SECTION 32. Section 156.053, Tax Code, is amended to read as
follows:
Sec. 156.053. COLLECTION OF TAX. A person owning,
operating, managing, or controlling a hotel, or subletting a room
or space in a hotel, shall collect for the state the tax that is
imposed by this chapter and that is calculated on the amount paid
for the [a] room or space in the hotel.
SECTION 33. Section 162.001, Tax Code, is amended by adding
subdivision (63) to read as follows:
(63) "Dyed diesel fuel retail dealer" means a dealer
who acquires dyed diesel fuel from a licensed supplier, permissive
supplier, or distributor for resale and delivery by the dealer into
the fuel supply tanks of motorboats, refrigeration units or other
off-highway equipment at a retail location.
SECTION 34. Section 162.101(b), Tax Code, is amended to
read as follows:
(b) A tax is imposed at the time gasoline is imported into
this state, other than by a bulk transfer, for delivery to a
destination in this state. The supplier or permissive supplier
shall collect the tax imposed by this subchapter from the person who
imports the gasoline into this state. If the seller is not a
supplier or permissive supplier, then the person who imports the
gasoline into this state shall pay the tax.
SECTION 35. Section 162.101(c), Tax Code, is amended to
read as follows:
(c) A tax is imposed on the removal [sale or transfer] of
gasoline from [in] the bulk transfer/terminal system in this state
[by a supplier to a person who does not hold a supplier's license].
The supplier shall collect the tax imposed by this subchapter from
the person who orders the removal from [sale or transfer in] the
bulk transfer terminal system.
SECTION 36. Section 162.103(d), Tax Code, is amended to
read as follows:
(d) A person who sells gasoline in this state, other than by
a bulk transfer, on which tax has not been paid for any purpose
other than a purpose exempt under Section 162.104 shall at the time
of sale collect the tax from the purchaser or recipient of gasoline
in addition to the selling price and is liable to this state for the
taxes collected at the time and in the manner provided by this
chapter.
SECTION 37. Section 162.128(d), Tax Code, is amended to
read as follows:
(d) A supplier, [or] permissive supplier, distributor,
importer, exporter or blender that determines taxes were
erroneously reported and remitted or that paid more taxes than were
due this state because of a mistake of fact or law may take a credit
on the monthly tax report on which the error has occurred and tax
payment made to the comptroller. The credit must be taken before
the expiration of the applicable period of limitation as provided
by Chapter 111.
SECTION 38. Section 162.201(b), Tax Code, is amended to
read as follows:
(b) A tax is imposed at the time diesel fuel is imported into
this state, other than by a bulk transfer, for delivery to a
destination in this state. The supplier or permissive supplier
shall collect the tax imposed by this subchapter from the person who
imports the diesel fuel into this state. If the seller is not a
supplier or permissive supplier, the person who imports the diesel
fuel into this state shall pay the tax.
SECTION 39. Section 162.201(c), Tax Code, is amended to
read as follows:
(c) A tax is imposed on the removal [sale or transfer] of
diesel fuel from [in] the bulk transfer/terminal system [in this
state by a supplier to a person who does not hold a supplier's
license]. The supplier shall collect the tax imposed by this
subchapter from the person who orders the removal from [sale or
transfer in] the bulk transfer/terminal system.
SECTION 40. Section 162.204(a), Tax Code, is amended to
read as follows:
(a) The tax imposed by this subchapter does not apply to:
(1) diesel fuel sold to the United States for its
exclusive use, provided that the exemption does not apply to diesel
fuel sold or delivered to a person operating under a contract with
the United States;
(2) diesel fuel sold to a public school district in
this state for the district's exclusive use;
(3) diesel fuel sold to a commercial transportation
company that provides public school transportation services to a
school district under Section 34.008, Education Code, and that uses
the diesel fuel only to provide those services;
(4) diesel fuel exported by either a licensed supplier
or a licensed exporter from this state to any other state, provided
that:
(A) for diesel fuel in a situation described by
Subsection (d), the bill of lading indicates the destination state
and the supplier collects the destination state tax; or
(B) for diesel fuel in a situation described by
Subsection (e), the bill of lading indicates the destination state,
the diesel fuel is subsequently exported, and the exporter is
licensed in the destination state to pay that state's tax and has an
exporter's license issued under this subchapter;
(5) diesel fuel moved by truck or railcar between
licensed suppliers or licensed permissive suppliers and in which
the diesel fuel removed from the first terminal comes to rest in the
second terminal, provided that the removal from the second terminal
rack is subject to the tax imposed by this subchapter;
(6) diesel fuel delivered or sold into a storage
facility of a licensed aviation fuel dealer from which the diesel
fuel will be delivered solely into the fuel supply tanks of aircraft
or aircraft servicing equipment, or sold from one licensed aviation
fuel dealer to another licensed aviation fuel dealer who will
deliver the diesel fuel exclusively into the fuel supply tanks of
aircraft or aircraft servicing equipment;
(7) diesel fuel exported to a foreign country if the
bill of lading indicates the foreign destination and the fuel is
actually exported to the foreign country;
(8) dyed diesel fuel sold or delivered by a supplier to
another supplier and dyed diesel fuel sold or delivered by a
supplier or distributor into the bulk storage facility of a dyed
diesel retail dealer, dyed diesel fuel bonded user or to a purchaser
who provides a signed statement as provided by Section 162.206;
(9) the volume of water, fuel ethanol, biodiesel, or
mixtures thereof that are blended together with taxable diesel fuel
when the finished product sold or used is clearly identified on the
retail pump, storage tank, and sales invoice as a combination of
diesel fuel and water, fuel ethanol, biodiesel, or mixtures
thereof;
(10) dyed diesel fuel sold by a supplier or permissive
supplier to a distributor, or by a distributor to another
distributor;
(11) dyed diesel fuel delivered by a license holder
into the fuel supply tanks of railway engines, motorboats, or
refrigeration units or other stationary equipment powered by a
separate motor from a separate fuel supply tank;
(12) dyed kerosene when delivered by a supplier,
distributor, or importer into a storage facility at a retail
business from which all deliveries are exclusively for heating,
cooking, lighting, or similar nonhighway use; or
(13) diesel fuel used by a person, other than a
political subdivision, who owns, controls, operates, or manages a
commercial motor vehicle as defined by Section 548.001,
Transportation Code, if the fuel:
(A) is delivered exclusively into the fuel supply
tank of the commercial motor vehicle; and
(B) is used exclusively to transport passengers
for compensation or hire between points in this state on a fixed
route or schedule.
SECTION 41. Section 162.205(a), Tax Code, is amended to
read as follows:
(a) A person shall obtain the appropriate license or
licenses issued by the comptroller before conducting the activities
of:
(1) a supplier, who may also act as a distributor,
importer, exporter, blender, motor fuel transporter, or aviation
fuel dealer without securing a separate license, but who is subject
to all other conditions, requirements, and liabilities imposed on
those license holders;
(2) a permissive supplier, who may also act as a
distributor, importer, exporter, blender, motor fuel transporter,
or aviation fuel dealer without securing a separate license but who
is subject to all other conditions, requirements, and liabilities
imposed on those license holders;
(3) a distributor, who may also act as an importer,
exporter, blender, or motor fuel transporter without securing a
separate license, but who is subject to all other conditions,
requirements, and liabilities imposed on those license holders;
(4) an importer, who may also act as an exporter,
blender, or motor fuel transporter without securing a separate
license, but who is subject to all other conditions, requirements,
and liabilities imposed on those license holders;
(5) a terminal operator;
(6) an exporter;
(7) a blender;
(8) a motor fuel transporter;
(9) an aviation fuel dealer;
(10) an interstate trucker; [or]
(11) a dyed diesel fuel bonded user; or
(12) a dyed diesel fuel retail dealer.
SECTION 42. Section 162.206(k), Tax Code, is added to read
as follows:
(k) Properly completed signed statements should be in the
possession of the licensed supplier or distributor at the time the
sale of dyed diesel fuel occurs. If the licensed supplier or
distributor is not in possession of these signed statements within
60 days from the date written notice requiring possession of them is
given to the licensed supplier or distributor by the comptroller,
exempt sales claimed by the licensed supplier or distributor that
require delivery of the signed statements shall be disallowed. If
the licensed supplier or distributor delivers the signed statements
to the comptroller within the 60-day period, the comptroller may
verify the reason or basis for the signed statements before
allowing the exempt sales. An exempt sale may not be granted on the
basis of signed statements delivered to the comptroller after the
60-day period.
SECTION 43. Section 162.211(b), Tax Code, is amended to
read as follows:
(b) The license issued to an aviation fuel dealer or dyed
diesel fuel retail dealer is permanent and is valid until the
license is surrendered by the holder or canceled by the
comptroller.
SECTION 44. Subsections (a), (b), and (c), Section 162.213,
Tax Code, are amended to read as follows:
(a) The comptroller, on or before December 20 of each year,
shall make available to all license holders an alphabetical list of
licensed suppliers, permissive suppliers, distributors, aviation
fuel dealers, importers, exporters, blenders, terminal operators,
dyed diesel fuel retail dealers, and dyed diesel fuel bonded users.
A supplemental list of additions and deletions shall be made
available to the license holders each month. A current and
effective license or the list furnished by the comptroller is
evidence of the validity of the license until the comptroller
notifies license holders of a change in the status of a license
holder.
(b) A licensed supplier or permissive supplier who sells
diesel fuel tax-free to a supplier, [or] permissive supplier or
aviation fuel dealer whose license has been canceled or revoked
under this chapter, or who sells dyed diesel fuel to a distributor,
dyed diesel fuel retail dealer or dyed diesel fuel bonded user whose
license has been canceled or revoked under this chapter, is liable
for any tax due on diesel fuel sold after receiving notice of the
cancellation or revocation.
(c) The comptroller shall notify all license holders under
this chapter when a canceled or revoked license is subsequently
reinstated and include in the notice the effective date of the
reinstatement. Sales to a supplier, permissive supplier,
distributor, aviation fuel dealer, dyed diesel fuel retail dealer
or dyed diesel fuel bonded user after the effective date of the
reinstatement may be made tax-free.
SECTION 45. Section 162.215(d), Tax Code, is amended to
read as follows:
(d) An aviation fuel dealer and a dyed diesel fuel retail
dealer are [is] not required to file a return.
SECTION 46. Section 162.216, Tax Code, is amended by
redesignating existing Subsections (m) and (n) as (n) and (o), and
by adding new Subsection (m) to read as follows:
(m) A dyed diesel fuel retail dealer shall keep a record
showing the number of gallons of:
(1) dyed and undyed diesel fuel inventories on hand at
the first of each month;
(2) dyed and undyed diesel fuel purchased or received,
showing the name of the seller and the date of each purchase or
receipt;
(3) dyed and undyed diesel fuel sold or used, showing
the date of the sale or use;
(4) dyed and undyed diesel fuel lost by fire, theft, or
accident; and
(5) for dyed diesel fuel an invoice containing:
(A) the stamped or preprinted name and address of
the seller;
(B) the name of the purchaser;
(C) the date of delivery of the dyed diesel fuel;
(D) the number of gallons of dyed diesel fuel
delivered;
(E) the type or description of the off-highway
equipment into which the dyed diesel fuel is delivered; and
(F) a notice stating "DYED DIESEL FUEL, NONTAXABLE USE ONLY,
PENALTY FOR TAXABLE USE".
(n) The comptroller may require selective schedules from a
supplier, permissive supplier, distributor, importer, exporter,
blender, terminal operator, motor fuel transporter, dealer,
aviation fuel dealer, dyed diesel fuel bonded user, and interstate
trucker for any purchase, sale, or delivery of diesel fuel if the
schedules are not inconsistent with the requirements of this
chapter.
(o) [(n)] The records required by this section must be kept
until the fourth anniversary of the date they are created and are
open to inspection at all times by the comptroller and the attorney
general.
SECTION 47. 162.230(d), Tax Code is amended to read as
follows:
(d) A supplier, [or] permissive supplier, distributor,
importer, exporter or blender that determines taxes were
erroneously reported and remitted or that paid more taxes than were
due to this state because of a mistake of fact or law may take a
credit on the monthly tax report on which the error has occurred and
tax payment made to the comptroller. The credit must be taken
before the expiration of the applicable period of limitation as
provided by Chapter 111.
SECTION 48. Sections 162.409(a) and (d), Tax Code, are
amended to read as follows:
Section 162.409. ISSUANCE OF BAD CHECK TO LICENSED
DISTRIBUTOR, [OR] LICENSED SUPPLIER, OR PERMISSIVE SUPPLIER.
(a) A person commits an offense if:
(1) the person issues or passes a check or similar
sight order for the payment of money knowing that the issuer does
not have sufficient funds in or on deposit with the bank or other
drawee for the payment in full of the check or order as well as all
other checks or orders outstanding at the time of issuance;
(2) the payee on the check or order is a licensed
distributor, [or] licensed supplier, or permissive supplier; and
(3) the payment is for an obligation or debt that
includes a tax under this chapter to be collected by the licensed
distributor, [or] licensed supplier, or permissive supplier.
(d) A person who makes payment on an obligation or debt that
includes a tax under this chapter and pays with an insufficient
funds check issued to a licensed distributor, [or] licensed
supplier, or permissive supplier may be held liable for a penalty
equal to the total amount of tax not paid to the licensed
distributor, [or] licensed supplier, or permissive supplier.
SECTION 49. Section 171.052, Tax Code, is amended to read as
follows:
An insurance organization[, title insurance company, or
title insurance agent] authorized to engage in insurance business
in this state now required to pay an annual tax under Chapter 221,
222, or 224 [4 or 9], Insurance Code, measured by its gross premium
receipts is exempted from the franchise tax. A nonadmitted
insurance organization that is required to pay a gross premium
receipts tax during a tax year is exempted from the franchise tax
for that same tax year. [Farm mutuals, local mutual aid
associations, and burial associations are not subject to the
franchise tax.]
SECTION 50. Subsection (h) of Section 171.109, Tax Code, is
amended to read as follows:
(h) A parent or investor corporation must use the cost
method of accounting in reporting and calculating the franchise tax
on its investments in subsidiary corporations or other investees.
In calculating the historical cost of an investment in a subsidiary
under the cost method of accounting, the cost may not be adjusted by
the preacquisition retained earnings of the subsidiary corporation
or other investee [The retained earnings of a subsidiary
corporation or other investee before acquisition by the parent or
investor corporation may not be excluded from the cost of the
subsidiary corporation or investee to the parent or investor
corporation and must be included by the parent or investor
corporation in calculating its surplus].
SECTION 51. Section 171.110, Tax Code, is amended by adding
a Subsection (m) to read as follows:
(m) Except as otherwise provided by this section, in
computing taxable earned surplus, a corporation is deemed to have
made an election to use the same methods used in filing its federal
income tax return. The corporation shall report based on its own
financial condition. Consolidated reporting is prohibited.
SECTION 52. Subsection (b) of Section 171.1121, Tax Code,
is amended to read as follows:
(b) Except as otherwise provided by this section, a
corporation shall use the same accounting methods to apportion
taxable earned surplus as it used to compute taxable earned surplus
[in computing reportable federal taxable income].
SECTION 53. Section 183.053(b), Tax Code, is amended to
read as follows:
(b) The total of bonds, certificates of deposit, letters of
credit, or other security determined to be sufficient by the
comptroller of a permittee subject to the tax imposed by this
chapter shall be in an amount that the comptroller determines to be
sufficient to protect the fiscal interests of the state. The
comptroller may not set the amount of security at less than $1,000
or more than the greater of $100,000 or four times the amount of the
permittee's average monthly tax liability [$50,000].
SECTION 54. Section 201.102, Tax Code, is amended to read as
follows:
Section 201.102. CASH SALES. If gas is sold for cash only,
the tax shall be computed on the producer's gross cash receipts.
Payments from a purchaser of gas to a producer for the purpose of
reimbursing the producer for taxes due under this chapter are not
part of the gross cash receipts [unless the reimbursement amount
for taxes due under this chapter is separately stated in the sales
contract].
SECTION 55. Section 201.352, Tax Code, is amended to read as
follows:
Sec. 201.352. UNLAWFUL PRODUCTION OR PURCHASE [REMOVAL] OF
GAS. On notice from the comptroller, no person may produce or make
payment for [remove] natural or casinghead gas from a lease in this
state if the owner or operator of the lease has failed to file a
report or pay a tax as required by this chapter. The comptroller
may request the railroad commission to place a seal on the well or
to otherwise disconnect the lease from any pipeline, metering or
custody transfer facility after notice to the operator of such
facility and the operator shall not reopen or otherwise reconnect
such facility until authorized to do so by the railroad commission.
SECTION 56. Section 321.203, Tax Code, is amended by
amending subsections (b), (c), (d), (e), and (g) and adding
subsection (n), to read as follows:
(b) If a retailer has only one place of business in this
state, all of the retailer's retail sales of taxable items
[tangible personal property] are consummated at that place of
business except as provided by Subsection (e).
(c) If a retailer has more than one place of business in this
state, a sale of a taxable item [tangible personal property] by the
retailer is consummated at the retailer's place of business:
(1) from which the retailer ships or delivers the item
[property], if the retailer ships or delivers the item [property]
to a point designated by the purchaser or lessee; or
(2) where the purchaser or lessee takes possession of
and removes the item [property], if the purchaser or lessee takes
possession of and removes the item [property] from a place of
business of the retailer.
(d) If neither the possession of a taxable item [tangible
personal property] is taken at nor shipment or delivery of the item
[property] is made from the retailer's place of business in this
state, the sale is consummated at:
(1) the retailer's place of business in this state
where the order is received; or
(2) if the order is not received at a place of business
of the retailer, the place of business from which the retailer's
salesman who took the order operates.
(e) A sale of a taxable item [tangible personal property] is
consummated at the location in this state to which the item
[property] is shipped or delivered or at which possession is taken
by the customer if transfer of possession of the item [property]
occurs at, or shipment or delivery of the item [property]
originates from, a location in this state other than a place of
business of the retailer and if:
(1) the retailer is an itinerant vendor who has no
place of business;
(2) the retailer's place of business where the
purchase order is initially received or from which the retailer's
salesman who took the order operates is outside this state; or
(3) the purchaser places the order directly with the
retailer's supplier and the property is shipped or delivered
directly to the purchaser by the supplier.
(n) A sale of a service described in Section 151.0047 to
remodel, repair, or restore nonresidential real property is
consummated at the location of the job site. However, if the job
site includes areas in multiple municipalities then the sale is
consummated at:
(1) the retailer's place of business in this state
where the order is received; or
(2) if the order is not received at a place of business
of the retailer, the place of business from which the retailer's
salesman who took the order operates.
SECTION 57. Section 321.302(c), Tax Code, is amended to
read as follows:
(c) If a municipality determines that a person doing
business in the municipality is not included in a comptroller's
report, the municipality shall report to the comptroller the name
and address of the person. Within 90 days after receiving the
report from a municipality, the comptroller shall send to the
municipality:
(1) an explanation as to why the person is not
obligated for the municipal tax;
(2) a statement that the person is obligated for the
municipal tax and the tax is delinquent; or
(3) a certification that the person is obligated for
the municipal tax and that the full amount of the tax due has been
credited to the municipality's account. In this section the phrase '
full amount of the tax due' means the amount of municipal tax to be
allocated that can be determined without a comptroller's audit of
the person's records.
SECTION 58. Section 321.503, Tax Code, is amended to read as
follows:
Section 321.503. STATE'S SHARE. Before sending any money
to a municipality under this subchapter the comptroller shall
deduct two percent of the amount of the taxes collected within the
municipality during the period for which a distribution is made as
the state's charge for its services under this chapter and shall[,
subject to the premiums payments under Section 321.501(c),] credit
the money deducted to the general revenue fund.
SECTION 59. Section 323.102(c), Tax Code, is amended to
read as follows:
(c) A tax imposed under Section 323.105 of this code or
Chapter 326 or 383, Local Government Code, takes effect on the first
day of the first calendar quarter after the expiration of the first
complete calendar quarter occurring after the date on which the
comptroller receives a notice of the action as required by Section
323.405(b).
SECTION 60. Section 323.203, Tax Code, is amended by
amending Subsections (b), (c), (d), (e), and (g) and adding
Subsection (m), to read as follows:
(b) If a retailer has only one place of business in this
state, all of the retailer's retail sales of taxable items
[tangible personal property] are consummated at that place of
business except as provided by Subsection (e).
(c) If a retailer has more than one place of business in this
state, a sale of a taxable item [tangible personal property] by the
retailer is consummated at the retailer's place of business:
(1) from which the retailer ships or delivers the item
[property], if the retailer ships or delivers the item [property]
to a point designated by the purchaser or lessee; or
(2) where the purchaser or lessee takes possession of
and removes the item [property], if the purchaser or lessee takes
possession of and removes the item [property] from a place of
business of the retailer.
(d) If neither the possession of a taxable item [tangible
personal property] is taken at nor shipment or delivery of the item
[property] is made from the retailer's place of business in this
state, the sale is consummated at:
(1) the retailer's place of business in this state
where the order is received; or
(2) if the order is not received at a place of business
of the retailer, the place of business from which the retailer's
salesman who took the order operates.
(e) A sale of a taxable item [tangible personal property] is
consummated at the location in this state to which the item
[property] is shipped or delivered or at which possession is taken
by the customer if transfer of possession of the item [property]
occurs at, or shipment or delivery of the item [property]
originates from, a location in this state other than a place of
business of the retailer and if:
(1) the retailer is an itinerant vendor who has no
place of business;
(2) the retailer's place of business where the
purchase order is initially received or from which the retailer's
salesman who took the order operates is outside this state; or
(3) the purchaser places the order directly with the
retailer's supplier and the property is shipped or delivered
directly to the purchaser by the supplier.
(m) A sale of a service described in Section 151.0047 to
remodel, repair, or restore nonresidential real property is
consummated at the location of the job site. However, if the job
site includes areas in multiple municipalities then the sale is
consummated at:
(1) the retailers place of business in this state
where the order is received; or
(2) if the order is not received at a place of business
of the retailer, the place of business from which the retailer's
salesman who took the order operates.
SECTION 61. Section 323.503, Tax Code, is amended to read as
follows:
Section 323.503. STATE'S SHARE. Before sending any money
to a county under this subchapter the comptroller shall deduct two
percent of the amount of the taxes collected within the county
during the period for which a distribution is made as the state's
charge for its services under this chapter and shall[, subject to
premiums payments under Section 323.501(c),] credit the money
deducted to the general revenue fund.
SECTION 62. Section 16.001(a) and (b), Utilities Code, are
amended to read as follows:
Section 16.001. ASSESSMENT ON UTILITY GROSS RECEIPTS
[PUBLIC UTILITIES].
(a) To defray the expenses incurred in the administration of
this title, an assessment is imposed on each telecommunications
utility, electric [public] utility, retail electric provider, and
electric cooperative within the jurisdiction of the commission that
serves the ultimate consumer, including each interexchange
telecommunications carrier.
(b) An assessment under this section is equal to one sixth
of one percent of the telecommunications utility's electric
[public] utility's, retail electric provider's, or electric
cooperative's gross receipts from rates charged to the ultimate
consumer in this state.
SECTION 63. Section 16.002(b), Utilities Code, is amended
to read as follows:
(b) A telecommunications utility, electric [public]
utility, retail electric provider, or electric cooperative may
instead make quarterly payments due August 15, November 15,
February 15, and May 15.
SECTION 64. The following sections of the Tax Code are
repealed:
(1) Section 151.103(d);
(2) Section 151.202(c);
(3) Section 321.203(l), Tax Code, as added by Section
115, Chapter 1310, Acts of the 78th Legislature, 2003. and
(4) Section 323.203(l).
SECTION 65. The changes made by this Act to Section 201.102,
Tax Code, apply to a refund claim or determination under Chapter
111, Tax Code, without regard to whether the taxes that are the
subject of the refund claim or determination were due before, on, or
after the effective date of this Act.
SECTION 66. The changes made by this Act to Section 111.009,
Tax Code, apply to a petition for redetermination filed on or after
the effective date of this Act.
SECTION 67. Effective date. This Act takes effect October
1, 2005.