83(R) HB 1579 - House Committee Report version

TO:	Honorable Harvey Hilderbran, Chair, House Committee on Ways & Means

FROM:	Ursula Parks, Director, Legislative Budget Board

IN RE:	HB1579 by Button (relating to the inclucsion of a portion of the costs of accepting credit and debit cards in the cost of goods sold for purposes of computing the franchise tax.), Committee Report 1st House, Substituted

Estimated Two-year Net Impact to General Revenue Related Funds for HB1579, Committee Report 1st House, Substituted: an impact of $0 through the biennium ending August 31, 2015.

Additionally, the bill will have a direct impact of a revenue loss to the Property Tax Relief Fund of ($20,883,000) for the 2014-15 biennium. Any loss to the Property Tax Relief Fund must be made up with an equal amount of General Revenue to fund the Foundation School Program.

General Revenue-Related Funds, Five-Year Impact:

Fiscal Year	Probable Net Positive/(Negative) Impact to General Revenue Related Funds
2014	$0
2015	$0
2016	$0
2017	$0
2018	$0

All Funds, Five-Year Impact:

Fiscal Year	Probable Revenue (Loss) from Property Tax Relief Fund 304
2014	($10,420,000)
2015	($10,463,000)
2016	($10,659,000)
2017	($10,470,000)
2018	($10,384,000)

This bill would amend Chapter 171 of the Tax Code, regarding the franchise tax, to add a provision that would include 20 percent of the costs attributable to the acceptance of credit cards and debit cards as a means of payment in a taxable entity's cost of goods sold for purposes of determining franchise tax liability.

The provision would override Section 171.1012(e)(2) which excludes expenses related to sales from cost of goods sold.

The bill would take effect on January 1, 2014, and apply to franchise tax reports due on or after that date.

The estimated fiscal impact is based on the Comptroller's franchise tax data files and on information on average credit card processing fees.

LEGISLATIVE BUDGET BOARD
Austin, Texas

FISCAL NOTE, 83RD LEGISLATIVE REGULAR SESSION


April 29, 2013