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A BILL TO BE ENTITLED
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AN ACT
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relating to sales and use taxes on e-cigarettes and nicotine |
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products; imposing taxes. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Subtitle E, Title 2, Tax Code, is amended by |
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adding Chapter 164 to read as follows: |
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CHAPTER 164. TAX ON E-CIGARETTES AND NICOTINE PRODUCTS |
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Sec. 164.0001. DEFINITIONS. In this chapter: |
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(1) "E-cigarette" has the meaning assigned by Section |
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161.081, Health and Safety Code. |
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(2) "Nicotine product" means an item that contains |
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nicotine and is not taxed under Chapter 154 or 155. |
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Sec. 164.0002. E-CIGARETTE AND NICOTINE PRODUCT SALES TAX. |
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(a) A tax is imposed on each sale of an e-cigarette or nicotine |
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product in this state. |
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(b) The tax rate is 10 percent of the sales price of an |
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e-cigarette or nicotine product sold. |
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(c) A tax imposed under this section is in addition to the |
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tax imposed under Subchapter C, Chapter 151. A tax imposed under |
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this section does not apply to a sale unless the tax imposed under |
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Subchapter C, Chapter 151, applies to the sale. |
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Sec. 164.0003. E-CIGARETTE AND NICOTINE PRODUCT USE TAX. |
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(a) A tax is imposed on the storage, use, or other consumption in |
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this state of an e-cigarette or nicotine product purchased from a |
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retailer for storage, use, or other consumption in this state. |
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(b) The tax rate is 10 percent of the sales price of an |
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e-cigarette or nicotine product stored, used, or otherwise consumed |
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in this state. |
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(c) A tax imposed under this section is in addition to the |
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tax imposed under Subchapter D, Chapter 151. A tax imposed under |
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this section does not apply to the storage, use, or other |
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consumption of an e-cigarette or nicotine product unless the tax |
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imposed under Subchapter D, Chapter 151, applies to the storage, |
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use, or other consumption. |
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Sec. 164.0004. APPLICATION OF OTHER PROVISIONS OF CODE. |
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(a) Except as provided by this chapter: |
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(1) the taxes imposed under this chapter are |
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administered, imposed, collected, and enforced in the same manner |
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as the taxes under Chapter 151 are administered, imposed, |
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collected, and enforced; and |
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(2) the provisions of Chapter 151 applicable to the |
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sales tax imposed under Subchapter C, Chapter 151, and the use tax |
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imposed under Subchapter D, Chapter 151, apply to the sales and use |
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taxes imposed under this chapter. |
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(b) A change in the law relating to the taxation of the sale |
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or use of an e-cigarette or nicotine product under Chapter 151 also |
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applies to the sales or use tax imposed under this chapter. |
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Sec. 164.0005. REPORTS. (a) A person required to file a |
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report under Section 151.403 who is also required to collect or pay |
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a tax under this chapter shall file with the comptroller a report |
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stating: |
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(1) for sales tax purposes, the amount of total |
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receipts from e-cigarettes and nicotine products sold by the seller |
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during the reporting period; |
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(2) for use tax purposes, the amount of total receipts |
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from e-cigarettes and nicotine products sold by the retailer during |
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the reporting period for storage, use, or other consumption in this |
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state; |
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(3) the amount of the total sales prices of |
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e-cigarettes and nicotine products subject to the use tax that were |
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acquired during the reporting period for storage, use, or other |
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consumption in this state by a purchaser who did not pay the tax to a |
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retailer; |
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(4) the amount of the taxes due under this chapter for |
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the reporting period; and |
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(5) any other information required by the comptroller. |
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(b) The report required by this section for a reporting |
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period is due on the same date that the tax payment for the period is |
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due. |
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Sec. 164.0006. RECORDS. (a) A person required to file a |
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report under Section 151.403 who is also required to collect or pay |
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a tax under this chapter shall keep a complete record of: |
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(1) all gross receipts from each sale to which this |
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chapter applies occurring during each reporting period, along with |
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documentation relating to those receipts; |
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(2) all purchases of e-cigarettes and nicotine |
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products, including the constituent parts of e-cigarettes and |
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nicotine products, from every source during each reporting period, |
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along with documentation relating to those purchases; |
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(3) all sales and use taxes, and any money represented |
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to be sales or use tax, collected under this chapter during each |
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reporting period; and |
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(4) any other information required by the comptroller. |
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(b) A person shall keep the records required by Subsection |
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(a) for the period required by Section 151.025(b). |
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Sec. 164.0007. DISPOSITION OF PROCEEDS. The comptroller |
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shall deposit the proceeds from taxes imposed under this chapter to |
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the credit of the general revenue fund. |
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SECTION 2. This Act takes effect September 1, 2021. |