Bill Text: TX HB1613 | 2017-2018 | 85th Legislature | Introduced
Bill Title: Relating to adjustment of the rates of the franchise tax; providing for decreases in tax rates.
Spectrum: Partisan Bill (Republican 2-0)
Status: (Introduced - Dead) 2017-03-29 - Left pending in committee [HB1613 Detail]
Download: Texas-2017-HB1613-Introduced.html
85R713 BEF-D | ||
By: Springer | H.B. No. 1613 |
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relating to adjustment of the rates of the franchise tax; providing | ||
for decreases in tax rates. | ||
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: | ||
SECTION 1. Sections 171.002(a) and (b), Tax Code, are | ||
amended to read as follows: | ||
(a) Subject to Sections 171.003, 171.004, and 171.1016 and | ||
except as provided by Subsection (b), the rate of the franchise tax | ||
is 0.75 percent of taxable margin. | ||
(b) Subject to Sections 171.003, 171.004, and 171.1016, the | ||
rate of the franchise tax is 0.375 percent of taxable margin for | ||
those taxable entities primarily engaged in retail or wholesale | ||
trade. | ||
SECTION 2. Subchapter A, Chapter 171, Tax Code, is amended | ||
by adding Section 171.004 to read as follows: | ||
Sec. 171.004. ADJUSTMENT OF TAX RATES. (a) Beginning in | ||
2018, on January 1 of each year of a biennium for which the | ||
comptroller's most recent certification estimate projects state | ||
tax revenues not dedicated by the constitution for that biennium | ||
will exceed the limit on appropriations in effect for the current | ||
biennium under Section 22(a), Article VIII, Texas Constitution: | ||
(1) the rate of the franchise tax under Section | ||
171.002(a) is adjusted by subtracting 0.15 from the rate in effect | ||
on December 31 of the previous year; | ||
(2) the rate of the franchise tax under Section | ||
171.002(b) is adjusted by subtracting 0.075 from the rate in effect | ||
on December 31 of the previous year; and | ||
(3) the rate of the franchise tax under Section | ||
171.1016(b)(3) is adjusted by subtracting 0.0662 from the rate in | ||
effect on December 31 of the previous year. | ||
(b) The tax rates determined under Subsection (a) apply to a | ||
report originally due on or after the date the determination is | ||
made. | ||
(c) Notwithstanding Subsection (a), if an adjustment | ||
otherwise required by Subsection (a) would reduce a rate of the | ||
franchise tax to less than zero, the rate is instead reduced to | ||
zero. | ||
(d) Notwithstanding any other law, if the rates of the | ||
franchise tax are reduced to zero under Subsection (a) or (c), a | ||
taxable entity does not owe any tax and is not required to file a | ||
report that would otherwise be originally due on or after the date | ||
the rates are reduced to zero. | ||
(e) The comptroller shall make the determination required | ||
by Subsection (a) and may adopt rules related to making that | ||
determination. The comptroller shall publish the franchise tax | ||
rates determined under this section in the Texas Register and on the | ||
comptroller's Internet website not later than January 15 of each | ||
year. | ||
(f) A determination by the comptroller under this section is | ||
final and may not be appealed. | ||
SECTION 3. Sections 171.1016(b) and (e), Tax Code, are | ||
amended to read as follows: | ||
(b) The amount of the tax for which a taxable entity that | ||
elects to pay the tax as provided by this section is liable is | ||
computed by: | ||
(1) determining the taxable entity's total revenue | ||
from its entire business, as determined under Section 171.1011; | ||
(2) apportioning the amount computed under | ||
Subdivision (1) to this state, as provided by Section 171.106, to | ||
determine the taxable entity's apportioned total revenue; and | ||
(3) multiplying the amount computed under Subdivision | ||
(2) by the rate of 0.331 percent or, if applicable, an adjusted tax | ||
rate adopted by the comptroller under Section 171.004. | ||
(e) A reference in this chapter or other law to the rate of | ||
the franchise tax means, as appropriate: | ||
(1) [ |
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taxable entity that elects to pay the tax as provided by this | ||
section, the rate under this section; or | ||
(2) the adjusted rates under Section 171.004. | ||
SECTION 4. This Act applies only to a report originally due | ||
on or after the effective date of this Act. | ||
SECTION 5. This Act takes effect January 1, 2018. |