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A BILL TO BE ENTITLED
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AN ACT
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relating to the exclusion of certain securities transaction |
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payments from the total revenue of a taxable entity that is an |
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exchange or a member of an exchange for purposes of the franchise |
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tax. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 171.0001(13-a), Tax Code, is amended to |
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read as follows: |
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(13-a) "Security," for purposes of Sections |
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171.1011(g), 171.1011(g-2), 171.1011(y), 171.1011(z), and |
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171.106(f) only, has the meaning assigned by Section 475(c)(2), |
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Internal Revenue Code, and includes instruments described by |
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Sections 475(e)(2)(B), (C), and (D) of that code. |
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SECTION 2. Section 171.1011, Tax Code, is amended by adding |
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Subsections (y) and (z) to read as follows: |
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(y) A taxable entity shall exclude from its total revenue: |
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(1) if the entity is an exchange, transaction rebate |
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payments made by the exchange to a member of the exchange as part of |
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a securities transaction; and |
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(2) if the entity is a member of an exchange, |
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transaction rebate payments made to the member by the exchange as |
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part of a securities transaction. |
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(z) For purposes of Subsection (y): |
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(1) "Exchange" has the meaning assigned by 15 U.S.C. |
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Section 78C(a)(1). |
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(2) "Member" has the meaning assigned by 15 U.S.C. |
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Section 78C(a)(3)(A). |
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(3) "Securities transaction" means the purchase or |
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sale of a security on an exchange by a member of the exchange. |
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(4) "Transaction rebate payment" means an amount paid |
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to compensate a member of the exchange in order to provide liquidity |
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to the market. |
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SECTION 3. This Act applies only to a report originally due |
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on or after the effective date of this Act. |
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SECTION 4. This Act takes effect January 1, 2026. |