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A BILL TO BE ENTITLED
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AN ACT
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relating to exemptions from the sales tax for certain business |
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entities during a limited period. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Subchapter H, Chapter 151, Tax Code, is amended |
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by adding Section 151.3411 to read as follows: |
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Sec. 151.3411. COMPUTER EQUIPMENT SOLD TO OR USED BY |
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ELIGIBLE BUSINESS ENTITIES DURING CERTAIN PERIODS. (a) In this |
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section: |
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(1) "Computer equipment" means a desktop or notebook |
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computer and related equipment, including: |
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(A) a computer monitor or other display device; |
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(B) a printer, which may also be capable of |
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performing scanning, photocopying, or facsimile functions; and |
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(C) other hardware or networking equipment for |
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computers, such as adapters, modems, servers, routers, and other |
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equipment associated with Internet access. |
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(2) "County average weekly wage" means the average |
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weekly wage in a county for all jobs during the most recent four |
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quarterly periods for which data is available, as computed by the |
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Texas Workforce Commission, at the time a small business creates a |
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job used to qualify for an exemption under this section. |
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(3) "Eligible small business" means a small business |
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that meets the qualifications prescribed by Subsection (c). |
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(4) "Qualifying job" means a permanent full-time job |
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the weekly wage for which exceeds the county average weekly wage in |
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the county in which the job is based. |
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(5) "Small business" means a corporation, |
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partnership, sole proprietorship, or other legal entity that |
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employs fewer than 100 permanent full-time employees, including the |
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employees employed in the qualified jobs created to qualify for an |
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exemption under this section. |
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(b) The sale, lease, or rental to or use by an eligible small |
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business of a taxable item that is computer equipment is exempted |
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from the taxes imposed by this chapter and the business may claim a |
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refund or credit as provided by this section if: |
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(1) the item: |
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(A) is for the exclusive use and benefit of the |
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business; |
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(B) is necessary for the operation of the |
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business; and |
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(C) replaces computer equipment with respect to |
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the sale, lease, rental, or use of which the business paid the tax |
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imposed by this chapter; and |
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(2) the sale, lease, rental, or use of the item occurs |
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not later than the fifth anniversary of the date the business |
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initially qualifies as an eligible small business. |
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(c) A small business is eligible for the exemption provided |
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by Subsection (b) from the tax imposed by this chapter if the |
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business: |
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(1) is engaged in business in this state; and |
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(2) on or after September 1, 2011: |
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(A) creates at least 25 qualifying jobs in the |
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county in which the headquarters or other main office of the |
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business is located; |
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(B) invests at least $10 million in capital |
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investments in this state; and |
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(C) purchases, leases, rents, or uses computer |
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equipment for the exclusive use and benefit of the business that is |
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necessary for the operation of the business and pays the tax imposed |
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by this chapter on that purchase, lease, rental, or use. |
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(d) An eligible small business entitled to a credit or |
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refund under this section may elect to receive either a credit or a |
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refund. A business that elects to receive a credit must claim the |
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credit on the return for the period that ends not later than the |
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first anniversary of the date the taxable event occurred. A |
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business that elects to receive a refund must apply to the |
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comptroller for the refund before or during the calendar year |
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following the year in which the tax was paid. |
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(e) The comptroller may require a small business that claims |
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a credit or applies for a refund under this section to provide to |
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the comptroller additional documentation necessary to establish |
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that the business is an eligible small business. |
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(f) A refund under this section is not a refund of taxes |
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erroneously collected, and Section 111.064 does not apply. |
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(g) The comptroller shall adopt rules necessary to |
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implement this section, including rules relating to the: |
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(1) qualification of a small business for an exemption |
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under this section; |
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(2) determination of the date a small business |
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initially qualifies as an eligible small business; and |
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(3) circumstances under which computer equipment is |
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considered to replace other computer equipment. |
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SECTION 2. 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 3. This Act takes effect September 1, 2011. |