LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE, 81ST LEGISLATIVE REGULAR SESSION April 15, 2009 TO: Honorable Rene Oliveira, Chair, House Committee on Ways & Means FROM: John S. O'Brien, Director, Legislative Budget Board IN RE:HB2944 by Harper-Brown (Relating to the franchise tax rates.), As Introduced Estimated Two-year Net Impact to General Revenue Related Funds for HB2944, As Introduced: a negative impact of ($1,056,267,000) through the biennium ending August 31, 2011. The bill will also have a direct impact of a revenue loss to the Property Tax Relief Fund of $3,615,872,000 for the 2010-11 biennium. Any loss to the Property Tax Relief Fund will have to be made up with General Revenue of the same amount to fund property tax relief.
LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 81ST LEGISLATIVE REGULAR SESSION
April 15, 2009
TO: Honorable Rene Oliveira, Chair, House Committee on Ways & Means FROM: John S. O'Brien, Director, Legislative Budget Board IN RE:HB2944 by Harper-Brown (Relating to the franchise tax rates.), As Introduced
TO: Honorable Rene Oliveira, Chair, House Committee on Ways & Means
FROM: John S. O'Brien, Director, Legislative Budget Board
IN RE: HB2944 by Harper-Brown (Relating to the franchise tax rates.), As Introduced
Honorable Rene Oliveira, Chair, House Committee on Ways & Means
Honorable Rene Oliveira, Chair, House Committee on Ways & Means
John S. O'Brien, Director, Legislative Budget Board
John S. O'Brien, Director, Legislative Budget Board
HB2944 by Harper-Brown (Relating to the franchise tax rates.), As Introduced
HB2944 by Harper-Brown (Relating to the franchise tax rates.), As Introduced
Estimated Two-year Net Impact to General Revenue Related Funds for HB2944, As Introduced: a negative impact of ($1,056,267,000) through the biennium ending August 31, 2011. The bill will also have a direct impact of a revenue loss to the Property Tax Relief Fund of $3,615,872,000 for the 2010-11 biennium. Any loss to the Property Tax Relief Fund will have to be made up with General Revenue of the same amount to fund property tax relief.
Estimated Two-year Net Impact to General Revenue Related Funds for HB2944, As Introduced: a negative impact of ($1,056,267,000) through the biennium ending August 31, 2011. The bill will also have a direct impact of a revenue loss to the Property Tax Relief Fund of $3,615,872,000 for the 2010-11 biennium. Any loss to the Property Tax Relief Fund will have to be made up with General Revenue of the same amount to fund property tax relief.
Estimated Two-year Net Impact to General Revenue Related Funds for HB2944, As Introduced: a negative impact of ($1,056,267,000) through the biennium ending August 31, 2011.
The bill will also have a direct impact of a revenue loss to the Property Tax Relief Fund of $3,615,872,000 for the 2010-11 biennium. Any loss to the Property Tax Relief Fund will have to be made up with General Revenue of the same amount to fund property tax relief.
General Revenue-Related Funds, Five-Year Impact: Fiscal Year Probable Net Positive/(Negative) Impact to General Revenue Related Funds 2010 ($518,807,000) 2011 ($537,460,000) 2012 ($601,001,000) 2013 ($630,411,000) 2014 ($641,033,000)
2010 ($518,807,000)
2011 ($537,460,000)
2012 ($601,001,000)
2013 ($630,411,000)
2014 ($641,033,000)
All Funds, Five-Year Impact: Fiscal Year Probable Revenue Gain/(Loss) fromGeneral Revenue Fund1 Probable Revenue Gain/(Loss) fromProperty Tax Relief Fund304 2010 ($518,807,000) ($1,788,414,000) 2011 ($537,460,000) ($1,827,458,000) 2012 ($601,001,000) ($1,846,713,000) 2013 ($630,411,000) ($1,915,238,000) 2014 ($641,033,000) ($2,006,468,000)
Fiscal Year Probable Revenue Gain/(Loss) fromGeneral Revenue Fund1 Probable Revenue Gain/(Loss) fromProperty Tax Relief Fund304 2010 ($518,807,000) ($1,788,414,000) 2011 ($537,460,000) ($1,827,458,000) 2012 ($601,001,000) ($1,846,713,000) 2013 ($630,411,000) ($1,915,238,000) 2014 ($641,033,000) ($2,006,468,000)
2010 ($518,807,000) ($1,788,414,000)
2011 ($537,460,000) ($1,827,458,000)
2012 ($601,001,000) ($1,846,713,000)
2013 ($630,411,000) ($1,915,238,000)
2014 ($641,033,000) ($2,006,468,000)
Fiscal Analysis
The bill would amend Chapter 171 of the Tax Code, regarding the franchise tax, by changing the tax rates applicable to taxable entities' taxable margin. The rate for taxable entities primarily engaged in retail or wholesale trade would be reduced to 0.25 percent from 0.5 percent. The tax rate for other taxable entities would be reduced to 0.5 percent from 1 percent. The bill would take effect January 1, 2010.
The bill would amend Chapter 171 of the Tax Code, regarding the franchise tax, by changing the tax rates applicable to taxable entities' taxable margin. The rate for taxable entities primarily engaged in retail or wholesale trade would be reduced to 0.25 percent from 0.5 percent. The tax rate for other taxable entities would be reduced to 0.5 percent from 1 percent.
The bill would take effect January 1, 2010.
Methodology
The estimated fiscal impact of the bill was based on data reported on the 2008 franchise tax reports.
Local Government Impact
No fiscal implication to units of local government is anticipated.
Source Agencies: 304 Comptroller of Public Accounts
304 Comptroller of Public Accounts
LBB Staff: JOB, MN, SD
JOB, MN, SD