By: Hodge H.B. No. 3324
A BILL TO BE ENTITLED
AN ACT
relating to a municipal and county sales and use tax on certain
amusements and discretionary food and drink items.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subtitle C, Title 3, Tax Code, is amended by
adding Chapter 328 to read as follows:
CHAPTER 328. MUNICIPAL AND COUNTY SALES AND USE TAX ON CERTAIN
AMUSEMENTS AND DISCRETIONARY FOOD AND DRINK ITEMS
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 328.001. APPLICABILITY OF CHAPTER. The provisions of
this chapter apply only to a sale of a taxable item to which the tax
imposed by Chapter 321 applies that occurs within the territory of
an authorized local governmental entity that elects to impose the
tax as provided by Section 328.051.
Sec. 328.002. DEFINITIONS. In this chapter:
(1) "Amusement services" means the provision of
amusement, entertainment, or recreation, but does not include the
provision of educational or health services if prescribed by a
licensed practitioner of the healing arts for the primary purpose
of education or health maintenance or improvement. The term
includes membership in a private club or organization that provides
entertainment, recreational, sports, dining, or social facilities
to its members.
(2) "Authorized local governmental entity" means a
municipality or county that:
(A) has a population of more than one million;
and
(B) is represented by a local or regional film
commission that is a member of the Association of Film Commissions
International (AFCI).
(3) "Sale or purchase" means any of the following when
done or performed for consideration:
(A) a transfer of title or possession of tangible
personal property;
(B) the exchange, barter, lease, or rental of
tangible personal property; or
(C) the performance of a taxable service, the
charge for an extended warranty or service contract for the
performance of a taxable service, or, in the case of an amusement
service, a transfer of title to or possession of a ticket or other
admission document, the collection of an admission fee, whether by
individual performance, subscription series, or membership
privilege, the collection of dues or a fee, charge, or assessment,
including an initiation fee, by a club or organization for
membership or a special privilege, status, or membership
classification in the club or organization, or the use of a
coin-operated machine.
(4) "Snack food" means any item that is ordinarily
sold for consumption without further preparation and that is not
generally considered a major component of a well-balanced meal.
The term includes:
(A) bakery items, including pastries, donuts,
cakes, tortes, pies, tarts, bars, and cookies;
(B) candy;
(C) chips, including chips made from potatoes,
flour, or corn;
(D) popcorn;
(E) pretzels; and
(F) roasted nuts.
(5) "Soft drink" means a nonalcoholic beverage that
contains natural or artificial sweeteners. The term does not
include a beverage that:
(A) contains:
(i) milk or milk products;
(ii) soy, rice, or similar milk
substitutes; or
(iii) more than 50 percent of vegetable or
fruit juice by volume;
(B) is intended by the manufacturer for
consumption by an infant and that is commonly referred to as "infant
formula"; or
(C) is intended by the manufacturer for use for
weight reduction.
(6) "Taxable item" means tangible personal property
and amusement services. Except as otherwise provided by this
chapter, the sale or use of a taxable item in electronic form
instead of on physical media does not alter the item's tax status.
(7) "Ticket" means the document sold in an amusement
services industry to a person to enable the person to gain admission
to an establishment for the purposes normally associated with that
industry.
[Sections 328.003-328.050 reserved for expansion]
SUBCHAPTER B. IMPOSITION AND COLLECTION OF TAX
Sec. 328.051. AUTHORIZED LOCAL GOVERNMENTAL AUTHORITY TO
IMPOSE TAX. (a) The commissioners court of a county that is an
authorized local governmental entity may adopt an order authorizing
the tax under this chapter.
(b) A municipality that is an authorized local governmental
entity may adopt an ordinance authorizing the tax under this
chapter.
(c) If a municipality that authorizes the tax under this
chapter as provided by Subsection (b) is located in a county that
also authorizes the tax under this chapter as provided by
Subsection (a), only the tax authorized by the municipality may be
imposed and collected on the sale of a taxable item that occurs in
the municipality.
Sec. 328.052. TAX IMPOSED. (a) A tax is imposed on each
sale at retail of a soft drink, snack food, or ticket.
(b) The tax rate is the rate adopted by the authorized
authorized local governmental entity that authorizes the tax and
applied to the sales price of the soft drink, snack food, or ticket,
not to exceed three percent of that sales price.
(c) The tax imposed under this chapter is in addition to any
other tax imposed by state law.
(d) The authorized local governmental entity that
authorizes the tax may increase or decrease the rate of the tax,
subject to Subsection (b). The entity by order or ordinance, as
applicable, may repeal the entity's authorization of the tax under
this chapter.
Sec. 328.053. COLLECTION. (a) The authorized local
governmental entity that authorizes the tax may, by order or
ordinance, as applicable, require the owner or lessee of an
approved venue project in the territory of the authorized local
governmental entity to collect the tax for the benefit of the
authorized local governmental entity.
(b) An owner or lessee required to collect the tax under
this section shall add the tax to the sale price of the soft drink,
snack food, or ticket. The tax is a part of the sale price, a debt
owed to the owner or lessee of the approved venue project by the
purchaser, and recoverable at law in the same manner as the sale
price.
(c) The tax imposed by this chapter is not an occupation tax
imposed on the owner or lessee of the approved venue project.
Sec. 328.054. REMITTANCE OF TAX. (a) A person required to
collect a tax imposed under this chapter shall report and send the
taxes to the authorized local governmental entity that authorizes
the tax in the manner provided by that entity.
(b) The authorized local governmental entity may prescribe
penalties, including interest charges, for failure to keep records
required by the entity, to report when required, or to pay the tax
when due. The attorney acting for the entity may bring suit against
a person who fails to collect a tax under this chapter and to remit
the tax as required.
(c) The authorized local governmental entity may permit a
person who is required to collect a tax under this chapter to retain
a percentage of the amount collected and required to be reported as
reimbursement to the person for the costs of collecting the tax.
The authorized local governmental entity may provide that the
person may retain the amount only if the person pays the tax and
files reports as required by the entity.
[Sections 328.055-328.100 reserved for expansion]
SUBCHAPTER C. ALLOCATION OF TAX
Sec. 328.101. DEPOSIT OF TAX REVENUE. Revenue from the tax
imposed under this chapter shall be deposited in the media
incentive fund of the authorized local governmental entity that
authorizes the tax.
Sec. 328.102. MEDIA INCENTIVE FUND. (a) An authorized
local governmental entity in which an approved venue project is
located shall establish by resolution a fund known as the media
incentive fund. The authorized local governmental entity shall
establish separate accounts within the fund for the various revenue
sources.
(b) The authorized local governmental entity shall deposit
into the media incentive fund:
(1) the proceeds of any tax collected and remitted to
the entity under this chapter;
(2) all revenue from the state or other sources
provided for this purpose; and
(3) any other money required by law to be deposited in
the fund.
(c) The authorized local governmental entity creating the
fund shall develop a program to use money in the fund for the
purpose of retaining existing and attracting new business related
to the film, television, and related industries. This program
should be established in coordination with the area's film
commission.
SECTION 2. This Act takes effect September 1, 2005.