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A BILL TO BE ENTITLED
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AN ACT
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relating to updating and clarifying the state sales and use tax. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 151.3162(b), Tax Code, is amended to |
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read as follows: |
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(b) The following items are exempted from the tax imposed by |
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this chapter: |
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(1) seedlings of trees [commonly] grown for commercial |
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timber; |
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(2) defoliants, desiccants, equipment, fertilizers, |
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fungicides, herbicides, insecticides, and machinery exclusively |
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used in the production of timber to be sold in the regular course of |
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business; |
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(3) machinery and equipment used in, and pollution |
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control equipment required as a result of, the processing, packing, |
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or marketing of timber products by an original producer if: |
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(A) the processing, packing, or marketing occurs |
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at or from a location operated by the original producer; |
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(B) at least 50 percent of the value of the timber |
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products processed, packed, or marketed at or from the location is |
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attributable to products produced by the original producer and not |
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purchased or acquired from others; and |
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(C) the original producer does not process, pack, |
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or market for consideration timber products that belong to another |
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person with a value greater than five percent of the total value of |
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the timber products processed, packed, or marketed by the producer; |
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and |
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(4) tangible personal property sold or used to be |
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installed as a component of an underground irrigation system |
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exclusively used in the production of timber to be sold in the |
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regular course of business. |
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SECTION 2. Sections 151.328(a) and (c), Tax Code, are |
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amended to read as follows: |
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(a) Aircraft are exempted from the taxes imposed by this |
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chapter if: |
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(1) sold to a person using the aircraft as a |
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certificated or licensed carrier of persons or property; |
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(2) sold to a person who: |
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(A) has a sales tax permit issued under this |
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chapter; and |
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(B) uses the aircraft for the purpose of |
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providing flight instruction that is: |
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(i) recognized by the Federal Aviation |
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Administration; |
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(ii) under the direct or general |
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supervision of a flight instructor certified by the Federal |
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Aviation Administration; and |
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(iii) designed to lead to a pilot |
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certificate or rating issued by the Federal Aviation Administration |
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or otherwise required by a rule or regulation of the Federal |
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Aviation Administration; |
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(3) sold to a foreign government; or |
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(4) sold to a person in this state for use and |
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registration in another state or nation before any use in this state |
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other than flight training in the aircraft and the transportation |
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of the aircraft out of this state. |
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(c) In this section, "aircraft" does not include a rocket or |
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missile, but does include: |
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(1) a fixed wing, heavier-than-air craft that is |
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driven by propeller or jet and supported by the dynamic reaction of |
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the air against its wings; |
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(2) a helicopter; and |
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(3) an airplane flight simulator approved by the |
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Federal Aviation Administration for use as a Level C [Phase II] or |
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higher flight simulator under Appendix A [H], 14 C.F.R. Part 60 |
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[121]. |
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SECTION 3. Section 151.0232, Tax Code, is repealed. |
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SECTION 4. The change in law made by this Act does not |
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affect tax liability accruing before the effective date of this |
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Act. That liability continues in effect as if this Act had not been |
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enacted, and the former law is continued in effect for the |
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collection of taxes due and for civil and criminal enforcement of |
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the liability for those taxes. |
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SECTION 5. This Act takes effect immediately if it receives |
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a vote of two-thirds of all the members elected to each house, as |
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provided by Section 39, Article III, Texas Constitution. If this |
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Act does not receive the vote necessary for immediate effect, this |
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Act takes effect September 1, 2007. |