Texas House Bill HB174

Texas 2021 - 87th Regular

Caption

Relating to exempting textbooks purchased, used, or consumed by university and college students from sales and use taxes for limited periods.

Impact

If enacted, the bill will amend the Texas Tax Code to establish specific exemption periods set by the comptroller, specifically seven consecutive days in January and another seven in August each year. These periods are to be determined based on when the majority of textbook purchases are made, ensuring that the tax relief aligns with student needs. The law will only apply to full-time and part-time students enrolled at accredited institutions in Texas, requiring valid student identification to claim the exemption.

Summary

House Bill 174 proposes a limited sales and use tax exemption for textbooks purchased by university and college students in Texas. The bill outlines that textbooks designed for educational purposes will be exempt from taxes during designated periods each year. This exemption is intended to alleviate financial burdens on students by reducing the overall cost of acquiring necessary educational materials, particularly during the start of academic semesters when textbook purchases peak.

Contention

Discussions around HB 174 may raise questions regarding the potential impact on state revenue from sales taxes, as tax exemptions could lead to a decrease in funding for public services reliant on this revenue source. While supporters argue that the bill represents an important step towards making higher education more affordable, opponents may voice concerns about the long-term sustainability of tax exemptions in a budget that increasingly relies on sales tax income. Stakeholders may also debate the fairness of the exemption, considering whether it disproportionately benefits students at private versus public institutions.