Bill Text: TX HB648 | 2019-2020 | 86th Legislature | Introduced
Bill Title: Relating to the substitution of a local sales and use tax for property taxes imposed by certain local governments; authorizing the imposition of a tax.
Spectrum: Partisan Bill (Republican 2-0)
Status: (Introduced - Dead) 2019-03-06 - No action taken in committee [HB648 Detail]
Download: Texas-2019-HB648-Introduced.html
86R5325 CJC-D | ||
By: Krause | H.B. No. 648 |
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relating to the substitution of a local sales and use tax for | ||
property taxes imposed by certain local governments; authorizing | ||
the imposition of a tax. | ||
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: | ||
SECTION 1. Subtitle C, Title 3, Tax Code, is amended by | ||
adding Chapter 328 to read as follows: | ||
CHAPTER 328. SUPPLEMENTAL LOCAL SALES AND USE TAX | ||
Sec. 328.001. DEFINITIONS. In this chapter: | ||
(1) "Lost property tax revenue" means the estimated | ||
amount of property tax revenue to be received by a qualifying local | ||
government for the tax year in which the local government adopts an | ||
ordinance or order described by Subdivision (2)(A), multiplied by | ||
1.08. | ||
(2) "Qualifying local government" means a | ||
municipality or county that: | ||
(A) before June 30 of a year: | ||
(i) adopts an ordinance or order providing | ||
that, beginning January 1 of the following year, the local | ||
government will not impose a property tax and instead elects to | ||
impose a supplemental sales and use tax; and | ||
(ii) forwards a certified copy of the | ||
ordinance or order described by Subparagraph (i) to the | ||
comptroller; or | ||
(B) in a preceding year, adopted and forwarded to | ||
the comptroller an ordinance or order described by Paragraph (A) | ||
but has not subsequently adopted an ordinance or order abolishing | ||
the supplemental sales and use tax imposed by the government. | ||
(3) "Supplemental sales and use tax" means a sales and | ||
use tax authorized by this chapter. | ||
Sec. 328.002. APPLICABILITY OF OTHER LAW. (a) Except as | ||
otherwise provided by this chapter: | ||
(1) Chapter 321 applies to a supplemental sales and | ||
use tax imposed by a municipality; and | ||
(2) Chapter 323 applies to a supplemental sales and | ||
use tax imposed by a county. | ||
(b) The following provisions do not apply to a supplemental | ||
sales and use tax: | ||
(1) Sections 321.101 and 323.101; | ||
(2) Subchapter E, Chapter 321, Subchapter E, Chapter | ||
323, and the other provisions of Chapters 321 and 323 relating to an | ||
election; | ||
(3) Sections 321.506-321.508; and | ||
(4) Section 323.505. | ||
(c) A supplemental sales and use tax is not an additional | ||
sales and use tax for purposes of Section 321.101 or any other law. | ||
Sec. 328.003. TAX AUTHORIZED. (a) A qualifying local | ||
government by adoption of an ordinance or order may adopt, | ||
increase, reduce, or abolish the supplemental sales and use tax. | ||
The tax is in addition to any other sales and use tax authorized by | ||
law, but may only be imposed during a period during which the | ||
qualifying local government does not impose a property tax. | ||
(b) A qualifying local government is not required to call an | ||
election to adopt, increase, reduce, or abolish the supplemental | ||
sales and use tax. | ||
Sec. 328.004. TAX RATE; INCREASE, REDUCTION, OR ABOLITION | ||
OF TAX. (a) In the first year in which a qualifying local | ||
government imposes the supplemental sales and use tax, the rate of | ||
the tax is equal to a rate that, when applied to the estimated | ||
cumulative sales price of the sale, use, storage, or other | ||
consumption of taxable items within the local government during | ||
that year, would produce an amount equal to the local government's | ||
lost property tax revenue. The ordinance or order authorizing the | ||
tax and adopted under Section 328.003 must specify the tax rate. | ||
(b) A qualifying local government that imposes the | ||
supplemental sales and use tax may by adoption of an ordinance or | ||
order annually increase or reduce the rate of the tax in increments | ||
of one-eighth of one percent. A reduction in the rate of the tax may | ||
not impair any outstanding debt or other obligation payable from | ||
the tax. | ||
(c) A qualifying local government that imposes the | ||
supplemental sales and use tax may by adoption of an ordinance or | ||
order abolish the tax if there is no outstanding debt secured by the | ||
tax. | ||
(d) A certified copy of an ordinance or order described by | ||
this section must be forwarded to the comptroller before June 30 of | ||
the year preceding the January 1 on which the action approved in the | ||
ordinance or order is to take effect. | ||
Sec. 328.005. SALES AND USE TAX EFFECTIVE DATE. The | ||
adoption, increase, reduction, or abolition of the supplemental | ||
sales and use tax takes effect on the next January 1 that is at least | ||
six months after the date the qualifying local government forwards | ||
to the comptroller the copy of the ordinance or order adopting, | ||
increasing, reducing, or abolishing the tax, as applicable. | ||
Sec. 328.006. EFFECT ON COMBINED LOCAL TAX RATE. The rate | ||
of a supplemental sales and use tax may not be considered for | ||
purposes of determining the combined local tax rate in any area. | ||
Sec. 328.007. USE OF TAX REVENUE. Revenue from a | ||
supplemental sales and use tax is for the use and benefit of the | ||
qualifying local government imposing the tax and may be used for any | ||
purpose for which the general funds of the local government may be | ||
used. | ||
SECTION 2. This Act takes effect immediately if it receives | ||
a vote of two-thirds of all the members elected to each house, as | ||
provided by Section 39, Article III, Texas Constitution. If this | ||
Act does not receive the vote necessary for immediate effect, this | ||
Act takes effect September 1, 2019. |