|
|
|
A BILL TO BE ENTITLED
|
|
AN ACT
|
|
relating to the imposition of the sales and use tax on taxable items |
|
sold or provided under certain contracts. |
|
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
|
SECTION 1. Subchapter C, Chapter 151, Tax Code, is amended |
|
by adding Section 151.0565 to read as follows: |
|
Sec. 151.0565. TAXABLE ITEMS SOLD OR PROVIDED UNDER |
|
DESTINATION MANAGEMENT SERVICES CONTRACTS. (a) In this section: |
|
(1) "Destination management services" means the |
|
following services: |
|
(A) transportation management; |
|
(B) booking and managing entertainers; |
|
(C) coordination of tours or recreational |
|
activities; |
|
(D) meeting, conference, or event registration; |
|
(E) meeting, conference, or event staffing; |
|
(F) event management; and |
|
(G) meal coordination. |
|
(2) "Qualified destination management company" means |
|
a business entity that: |
|
(A) is incorporated or is a limited liability |
|
company; |
|
(B) receives at least 80 percent of the entity's |
|
annual total revenue from its entire business, as determined under |
|
Section 171.1011, from providing or arranging for the provision of |
|
a combination of at least four destination management services; |
|
(C) maintains a permanent nonresidential office |
|
from which the destination management services are provided or |
|
arranged; |
|
(D) has at least three full-time employees during |
|
all or part of a calendar year; |
|
(E) other than office equipment used in the |
|
conduct of the entity's business, does not own equipment used to |
|
directly provide destination management services, including motor |
|
coaches, limousines, sedans, dance floors, decorative props, |
|
lighting, podiums, sound or video equipment, or equipment for |
|
catered meals; |
|
(F) is not doing business as a caterer; |
|
(G) does not provide services for weddings; and |
|
(H) does not own a venue at which events or |
|
activities for which destination management services are provided |
|
occur. |
|
(3) "Qualified destination management services |
|
contract" means a contract under which destination management |
|
services are provided: |
|
(A) by a qualified destination management |
|
company that pays each person who sells or leases to the company |
|
taxable items that will be consumed or used in performing the |
|
contract for: |
|
(i) the sale or use of those items; and |
|
(ii) amounts charged by the person for |
|
sales and use taxes imposed by this chapter; and |
|
(B) to a client that is not an individual and |
|
that: |
|
(i) is a corporation, partnership, limited |
|
liability company, trade association, or other business entity, |
|
other than a social club or fraternal organization; |
|
(ii) has its principal place of business |
|
outside the county where the destination management services are to |
|
be provided; and |
|
(iii) agrees to pay the qualified |
|
destination management company for all destination management |
|
services provided to the client under the terms of the contract. |
|
(b) A qualified destination management company is the |
|
consumer of taxable items sold or otherwise provided under a |
|
qualified destination management services contract, and the |
|
destination management services provided under the contract are not |
|
considered taxable services, as that term is defined by Section |
|
151.0101. |
|
SECTION 2. Section 151.0565, Tax Code, as added by this Act, |
|
is a clarification of existing law and does not imply that the |
|
former law may be construed as inconsistent with the law as added by |
|
this Act. |
|
SECTION 3. This Act takes effect immediately 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 immediate effect, this |
|
Act takes effect September 1, 2009. |