79R5728 DAK-D

By:  Hunter                                                       H.B. No. 3361



A BILL TO BE ENTITLED

AN ACT

relating to an exemption from the sales and use tax for certain job 
creation activities.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        
	SECTION 1.  Subchapter H, Chapter 151, Tax Code, is amended 
by adding Section 151.366 to read as follows:
	Sec. 151.366.  CERTAIN JOB CREATION ACTIVITIES.  (a)  In this 
section:
		(1)  "Qualifying job" means a new permanent full-time 
job that:      
			(A)  requires at least 1,600 hours of work each 
year;               
			(B)  pays at least 110 percent of the county 
average weekly wage for the county where the job is located;
			(C)  is covered by a group health benefit plan for 
which the employer pays at least 80 percent of the premiums or other 
charges assessed under the plan for the employee;
			(D)  is not transferred from one area in this 
state to another area in this state; and
			(E)  is not created to replace a previous 
employee.                 
		(2)  "Starting date of the business or activity" means 
the date tangible personal property is first sold, leased, or 
rented to or stored, used, or consumed by a person in the county in 
which the business or activity is being established for the purpose 
of qualifying the person for the exemption under this section.
	(b)  Tangible personal property sold, leased, or rented to or 
stored, used, or consumed by a person is exempted from the taxes 
imposed by this chapter as provided by this section if:
		(1)  the person establishes a new business or other 
activity in a county with a population of less than 140,000;
		(2)  the business or activity creates a minimum of 10 
qualifying jobs before the first anniversary of the starting date 
of the business or activity; and
		(3)  the property is sold, leased, or rented to or 
stored, used, or consumed by the person in the county for the 
purpose of establishing the business or other activity.
	(c)  The exemption provided by this section begins on the 
starting date of the business or activity and ends on the first 
anniversary of that date.
	(d)  The comptroller shall promulgate a form by which a 
person may apply for an application under this section.  The 
comptroller may require that the person submitting the application 
include any information and documentation that the comptroller 
considers necessary to determine whether the person qualifies for 
an exemption under this section.
	(e)  A person is eligible for the exemption under this 
section only if the person applies to the comptroller, provides to 
the comptroller all information and documentation requested by the 
comptroller, and the comptroller approves the application.  The 
comptroller may approve the application only if the person 
establishes that the business or other activity meets or is likely 
to meet the requirements of Subsection (b).
	(f)  The comptroller may reevaluate and approve or not 
approve an application for an exemption under this section on or 
before the first anniversary of the date the exemption period ends 
as provided by Subsection (c).  A person whose application is not 
approved is liable for any tax previously exempted under this 
section and a person whose application is approved is entitled to a 
credit for any tax paid but subject to the exemption under this 
section.
	(g)  The comptroller may adopt rules to implement and 
administer this section.
	SECTION 2.  The change in law made by this Act does not 
affect taxes imposed before the effective date of this Act, and the 
law in effect before the effective date of this Act is continued in 
effect for purposes of the liability for and collection of those 
taxes.
	SECTION 3.  This Act takes effect July 1, 2005, if it 
receives a vote of two-thirds of all the members elected to each 
house, as provided by Section 39, Article III, Texas Constitution.  
If this Act does not receive the vote necessary for effect on that 
date, this Act takes effect October 1, 2005.