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A BILL TO BE ENTITLED
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AN ACT
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relating to the computation and rates of the franchise tax. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Sections 171.002(a), (b), and (d), Tax Code, are |
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amended to read as follows: |
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(a) Subject to Sections 171.003 and 171.1016 and except as |
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provided by Subsection (b), the rate of the franchise tax is 0.75 |
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[one] percent of taxable margin. |
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(b) Subject to Sections 171.003 and 171.1016, the rate of |
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the franchise tax is 0.375 [0.5] percent of taxable margin for those |
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taxable entities primarily engaged in retail or wholesale trade. |
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(d) A taxable entity is not required to pay any tax and is |
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not considered to owe any tax for a period if: |
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(1) the amount of tax computed for the taxable entity |
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is less than $1,000; or |
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(2) the amount of the taxable entity's total revenue |
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from its entire business is less than or equal to $1 million |
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[$300,000] or the amount determined under Section 171.006 per |
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12-month period on which margin is based. |
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SECTION 2. Section 171.006(b), Tax Code, is amended to read |
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as follows: |
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(b) On [Beginning in 2010, on] January 1 of each |
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even-numbered year, the amounts prescribed by Sections |
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171.002(d)(2)[, 171.0021,] and 171.1013(c) are increased or |
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decreased by an amount equal to the amount prescribed by those |
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sections on December 31 of the preceding year multiplied by the |
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percentage increase or decrease during the preceding state fiscal |
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biennium in the consumer price index and rounded to the nearest |
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$10,000. |
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SECTION 3. Sections 171.0021 and 171.1016(d), Tax Code, are |
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repealed. |
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SECTION 4. This Act applies only to a report originally due |
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on or after the effective date of this Act. |
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SECTION 5. This Act takes effect January 1, 2010. |