Honorable Dustin Burrows, Chair, House Committee on Ways & Means
FROM:
John McGeady, Assistant Director Sarah Keyton, Assistant Director Legislative Budget Board
IN RE:
HB1089 by Darby (Relating to the classification of certain entities as primarily engaged in retail trade for purposes of the franchise tax.), As Introduced
Estimated Two-year Net Impact to General Revenue Related Funds for HB1089, As Introduced: an impact of $0 through the biennium ending August 31, 2021.
Additionally, the bill will have a direct impact of a revenue loss to the Property Tax Relief Fund of ($2,334,000) for the 2018-19 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.
Fiscal Year
Probable Net Positive/(Negative) Impact to General Revenue Related Funds
2020
$0
2021
$0
2022
$0
2023
$0
2024
$0
Fiscal Year
Probable Revenue (Loss) from Property Tax Relief Fund 304
2020
$0
2021
($2,334,000)
2022
($2,427,000)
2023
($2,523,000)
2024
($2,623,000)
Fiscal Analysis
The bill would amend Chapter 171 of the Tax Code to expand the definition of retail trade to include activities involving the rental of industrial uniforms, industrial garments, and industrial linen supplies that are classified as linen supply services or industrial launderers in the 1987 Standard Industrial Classification Manual.
The bill would take effect January 1, 2021, and would only apply to reports originally due on or after that date.
Methodology
The estimated revenue loss from this bill is based on franchise tax return data from the Comptroller's Office and sub-sector forecasts from IHS Markit.
Local Government Impact
No fiscal implication to units of local government is anticipated.