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A BILL TO BE ENTITLED
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AN ACT
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relating to the exemption from certain registration and licensing |
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requirements and taxes for certain businesses and employees who |
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enter this state in response to a disaster or emergency. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Subtitle C, Title 5, Business & Commerce Code, is |
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amended by adding Chapter 112 to read as follows: |
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CHAPTER 112. FACILITATING BUSINESS RAPID RESPONSE TO STATE |
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DECLARED DISASTERS ACT |
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Sec. 112.001. SHORT TITLE. This chapter may be cited as the |
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Facilitating Business Rapid Response to State Declared Disasters |
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Act. |
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Sec. 112.002. LEGISLATIVE FINDINGS. The legislature finds |
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that: |
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(1) during times of storm, flood, fire, earthquake, |
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hurricane, or other disaster or emergency, many Texas businesses |
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bring in resources and personnel from other states on a temporary |
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basis to expedite the often enormous and overwhelming tasks of |
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cleaning up, restoring, and repairing damaged buildings, |
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equipment, and property, and deploying and building new replacement |
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facilities in the state; |
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(2) accomplishing those tasks may necessitate |
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out-of-state businesses, including out-of-state affiliates of |
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Texas businesses, bringing into Texas resources, property, and |
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personnel that previously had no connection to Texas to perform |
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business activities in Texas, including repairing, renovating, |
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installing, and building, for extended periods of time; |
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(3) during those periods of time, out-of-state |
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businesses and employees performing business activities in Texas on |
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a temporary basis solely for the purpose of helping the state |
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recover from a disaster or emergency should not be burdened by any |
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requirements that the out-of-state businesses or employees pay |
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taxes as a result of performing those activities; |
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(4) Texas' nexus and residency thresholds are intended |
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for businesses and individuals who intend to conduct regular |
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business operations in the state or to permanently reside in the |
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state and should not be applied to businesses and individuals who |
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come to the state on a temporary basis to provide help and |
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assistance in response to a disaster or emergency; and |
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(5) to ensure that out-of-state businesses may focus |
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on quickly responding to the needs of Texas and its citizens during |
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a disaster or emergency, it is appropriate for the legislature to |
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provide that those businesses and their employees are not subject |
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to certain state and local registration and licensing requirements |
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and taxes for performing business activities before, during, and |
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after the disaster or emergency to repair and restore devastating |
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damage to critical property and infrastructure in the state. |
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Sec. 112.003. DEFINITIONS. (a) In this chapter: |
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(1) "Critical infrastructure" means equipment and |
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property that is owned by or used for communications networks, |
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electric generation, transmission and distribution systems, gas |
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distribution systems, and water pipelines and related support |
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facilities, equipment, and property that serve multiple persons, |
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including buildings, offices, structures, lines, poles, and pipes. |
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(2) "Declared state disaster or emergency" means a |
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disaster or emergency event that occurs in this state and: |
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(A) in response to which the governor issues an |
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executive order or proclamation declaring a state of disaster or a |
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state of emergency; |
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(B) that the president of the United States |
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declares a major disaster or emergency; or |
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(C) that requires a good faith response effort |
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and that an authorized state official, other than the governor, |
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designates a disaster or emergency in order to invoke this chapter. |
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(3) "Disaster- or emergency-related work" means |
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repairing, renovating, installing, building, rendering services, |
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or performing other business activities relating to the repair or |
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replacement of critical infrastructure that has been damaged, |
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impaired, or destroyed by a declared state disaster or emergency. |
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(4) "Disaster response period" means the period that: |
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(A) begins on the 10th day before the date of the |
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earliest event establishing a declared state disaster or emergency |
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by the issuance of an executive order or proclamation by the |
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governor, a declaration of the president of the United States, or |
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the designation of an authorized state official; and |
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(B) ends on the 60th day after the ending date of |
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the disaster or emergency period established by the executive order |
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or proclamation, declaration, or designation or on a later date as |
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determined by the secretary of state. |
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(5) "In-state business entity" means a domestic entity |
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or foreign entity that is authorized to transact business in this |
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state immediately before a disaster response period. |
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(6) "Out-of-state business entity" means a foreign |
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entity that: |
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(A) except with respect to the performance of |
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disaster- or emergency-related work: |
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(i) has no physical presence in this state |
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and is not authorized to transact business in this state |
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immediately before a disaster response period; and |
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(ii) is not registered with the secretary |
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of state to transact business in this state, does not a file a tax |
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report with this state or a political subdivision of this state, and |
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does not have a nexus with this state for the purpose of taxation |
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during the tax year immediately preceding the disaster response |
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period; and |
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(B) enters this state at the request of an |
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in-state business entity, the state, or a political subdivision of |
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the state to perform disaster- or emergency-related work in this |
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state during the disaster response period. |
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(7) "Out-of-state employee" means an employee who |
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enters this state to perform disaster- or emergency-related work |
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during a disaster response period. |
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(b) For purposes of this chapter, a foreign entity may be |
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considered an "out-of-state business entity" even if the foreign |
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entity is affiliated with an in-state business entity through |
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common ownership. |
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Sec. 112.004. EXEMPTION OF OUT-OF-STATE BUSINESS ENTITY |
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FROM CERTAIN OBLIGATIONS DURING DISASTER RESPONSE PERIOD. |
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Notwithstanding any other law and except as provided by Section |
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112.006, an out-of-state business entity whose transaction of |
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business in this state is limited to the performance of disaster- or |
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emergency-related work during a disaster response period is not |
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required to: |
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(1) register with the secretary of state; |
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(2) file a tax report with or pay taxes or fees to this |
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state or a political subdivision of this state; |
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(3) pay an ad valorem tax or use tax on equipment that |
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is brought into the state by the entity, used only by the entity to |
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perform disaster- or emergency-related work during the disaster |
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response period, and removed from the state by the entity following |
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the disaster response period; |
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(4) comply with any state or local business licensing |
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or registration requirements; or |
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(5) comply with any state or local occupational |
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licensing requirements or related fees. |
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Sec. 112.005. EXEMPTION OF OUT-OF-STATE EMPLOYEE FROM |
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CERTAIN OBLIGATIONS DURING DISASTER RESPONSE PERIOD. |
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Notwithstanding any other law and except as provided by Section |
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112.006, an out-of-state employee whose only employment in this |
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state is for the performance of disaster- or emergency-related work |
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during a disaster response period is not required to: |
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(1) file a tax report with or pay taxes or fees to this |
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state or a political subdivision of this state; or |
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(2) comply with any state or local occupational |
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licensing requirements or related fees. |
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Sec. 112.006. TRANSACTION TAXES AND FEES. An out-of-state |
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business entity whose transaction of business in this state is |
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limited to the performance of disaster- or emergency-related work |
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during a disaster response period or an out-of-state employee whose |
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only employment in this state is for the performance of disaster- or |
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emergency-related work during a disaster response period is subject |
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to a transaction tax or fee, including a motor fuels tax, sales or |
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use tax, hotel occupancy tax, and the tax imposed on the rental of a |
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motor vehicle, that is imposed in this state, unless the entity or |
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employee is otherwise exempt from the tax or fee. |
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Sec. 112.007. NOTIFICATION PROCEDURES. (a) If requested |
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by the secretary of state, an out-of-state business entity shall |
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provide to the secretary of state a statement that the entity came |
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to this state for the purpose of performing disaster- or |
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emergency-related work during a disaster response period and that |
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includes: |
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(1) the entity's name; |
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(2) the entity's jurisdiction of formation; |
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(3) the address of the principal office of the entity; |
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(4) the entity's federal tax identification number; |
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(5) the date that the entity entered the state; and |
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(6) contact information for the entity. |
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(b) If requested by the secretary of state, an in-state |
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business entity shall provide to the secretary of state, along with |
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the in-state business entity's contact information, the |
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information listed in Subsection (a) for any affiliate of the |
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in-state business entity that entered the state as an out-of-state |
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business entity. |
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(c) The secretary of state shall keep records of and make |
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available to the public any statements or information provided to |
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the secretary of state under this section. |
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Sec. 112.008. OBLIGATIONS OF OUT-OF-STATE BUSINESS |
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ENTITIES AND EMPLOYEES AFTER DISASTER RESPONSE PERIOD. An |
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out-of-state business entity or out-of-state employee who remains |
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in this state after a disaster response period is not entitled to |
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any exemptions from obligations provided by this chapter. |
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Sec. 112.009. REGULATIONS. The secretary of state shall |
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adopt regulations, including developing any necessary forms or |
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processes, to implement this chapter. |
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SECTION 2. (a) Subchapter B, Chapter 151, Tax Code, is |
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amended by adding Section 151.0241 to read as follows: |
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Sec. 151.0241. PERSONS PERFORMING DISASTER- OR |
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EMERGENCY-RELATED WORK. (a) In this section, "disaster- or |
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emergency-related work," "disaster response period," and |
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"out-of-state business entity" have the meanings assigned by |
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Section 112.003, Business & Commerce Code. |
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(b) An out-of-state business entity is not engaged in |
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business in this state for purposes of Sections 151.107 and 151.403 |
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or any other provision of this chapter applicable to a person |
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engaged in business in this state if the entity's physical presence |
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in this state is solely from the entity's performance of disaster- |
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or emergency-related work during a disaster response period. |
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(b) Subchapter H, Chapter 151, Tax Code, is amended by |
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adding Section 151.3502 to read as follows: |
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Sec. 151.3502. SERVICES AND TANGIBLE PERSONAL PROPERTY SOLD |
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IN PERFORMING DISASTER- OR EMERGENCY-RELATED WORK. (a) In this |
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section, "disaster- or emergency-related work," "disaster response |
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period," and "out-of-state business entity" have the meanings |
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assigned by Section 112.003, Business & Commerce Code. |
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(b) The sale, lease, or rental of a taxable item by an |
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out-of-state business entity in performing disaster- or |
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emergency-related work during a disaster response period is |
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exempted from the taxes imposed by this chapter. |
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(c) Sections 151.0241 and 151.3502, Tax Code, as added by |
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this section, do not affect tax liability accruing before the |
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effective date of this Act. That liability continues in effect as |
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if this Act had not been enacted, and the former law is continued in |
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effect for the collection of taxes due and for civil and criminal |
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enforcement of the liability for those taxes. |
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SECTION 3. (a) Section 171.0002, Tax Code, is amended by |
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adding Subsection (c-1) to read as follows: |
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(c-1) "Taxable entity" does not include an out-of-state |
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business entity whose sole nexus with this state for the purpose of |
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taxation is the entity's provision of disaster- or |
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emergency-related work during a disaster response period. In this |
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subsection, "disaster- or emergency-related work," "disaster |
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response period," and "out-of-state business entity" have the |
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meanings assigned by Section 112.003, Business & Commerce Code. |
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(b) This section applies only to a franchise tax report |
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originally due on or after the effective date of this section. |
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(c) This section takes effect January 1, 2016. |
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SECTION 4. Except as otherwise provided by this Act: |
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(1) if this Act receives a vote of two-thirds of all |
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the members elected to each house, as provided by Section 39, |
|
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Article III, Texas Constitution, this Act takes effect immediately; |
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and |
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(2) if this Act does not receive the vote necessary for |
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immediate effect, this Act takes effect September 1, 2015. |