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:HB3339 by Hopson (Relating to the tax on cigarettes.), As Introduced The bill could have a direct impact of a revenue gain to the Property Tax Relief Fund of $55,916,000 for the 2010-11 biennium. Any gain to the Property Tax Relief Fund will free up General Revenue of the same amount.
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:HB3339 by Hopson (Relating to the tax on cigarettes.), As Introduced
TO: Honorable Rene Oliveira, Chair, House Committee on Ways & Means
FROM: John S. O'Brien, Director, Legislative Budget Board
IN RE: HB3339 by Hopson (Relating to the tax on cigarettes.), 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
HB3339 by Hopson (Relating to the tax on cigarettes.), As Introduced
HB3339 by Hopson (Relating to the tax on cigarettes.), As Introduced
The bill could have a direct impact of a revenue gain to the Property Tax Relief Fund of $55,916,000 for the 2010-11 biennium. Any gain to the Property Tax Relief Fund will free up General Revenue of the same amount.
The bill could have a direct impact of a revenue gain to the Property Tax Relief Fund of $55,916,000 for the 2010-11 biennium. Any gain to the Property Tax Relief Fund will free up General Revenue of the same amount.
The bill could have a direct impact of a revenue gain to the Property Tax Relief Fund of $55,916,000 for the 2010-11 biennium. Any gain to the Property Tax Relief Fund will free up General Revenue of the same amount.
General Revenue-Related Funds, Five-Year Impact: Fiscal Year Probable Net Positive/(Negative) Impact to General Revenue Related Funds 2010 $0 2011 $0 2012 $0 2013 $0 2014 $0
2010 $0
2011 $0
2012 $0
2013 $0
2014 $0
All Funds, Five-Year Impact: Fiscal Year Probable Revenue Gain/(Loss) fromProperty Tax Relief Fund304 2010 $26,661,000 2011 $29,255,000 2012 $25,542,000 2013 $28,159,000 2014 $24,468,000
Fiscal Year Probable Revenue Gain/(Loss) fromProperty Tax Relief Fund304 2010 $26,661,000 2011 $29,255,000 2012 $25,542,000 2013 $28,159,000 2014 $24,468,000
2010 $26,661,000
2011 $29,255,000
2012 $25,542,000
2013 $28,159,000
2014 $24,468,000
Fiscal Analysis
This bill would amend Chapter 154 of the Tax Code, regarding the cigarette tax by providing an alternative method for levying the tax on cigarettes. The tax would be the greater of (1) the current tax of $70.50 per 1,000 cigarettes, or (2) a tax of 55 percent of the manufacturer's list price, exclusive of trade discount, special discount, or deal. The bill would allocate to the Property Tax Relief Fund 0304 the cigarette tax revenues collected in excess of the revenue that would have been collected had the cigarettes been taxed at the rate of $20.50 per 1,000 cigarettes. The bill would take effect September 1, 2009.
This bill would amend Chapter 154 of the Tax Code, regarding the cigarette tax by providing an alternative method for levying the tax on cigarettes. The tax would be the greater of (1) the current tax of $70.50 per 1,000 cigarettes, or (2) a tax of 55 percent of the manufacturer's list price, exclusive of trade discount, special discount, or deal.
The bill would allocate to the Property Tax Relief Fund 0304 the cigarette tax revenues collected in excess of the revenue that would have been collected had the cigarettes been taxed at the rate of $20.50 per 1,000 cigarettes.
The bill would take effect September 1, 2009.
Methodology
The Comptroller of Public Accounts indicates that due to the ambiguity of Section 154.021(b), as amended by the bill, it is unclear what tax rate would apply and in precisely what circumstance. Therefore, the fiscal implications of this bill cannot be determined. As an illustrative example, however, and assuming rates would be utilized such that revenue were maximized, the following implications to the Property Tax Relief Fund 0304 may occur.
The Comptroller of Public Accounts indicates that due to the ambiguity of Section 154.021(b), as amended by the bill, it is unclear what tax rate would apply and in precisely what circumstance. Therefore, the fiscal implications of this bill cannot be determined.
As an illustrative example, however, and assuming rates would be utilized such that revenue were maximized, the following implications to the Property Tax Relief Fund 0304 may occur.
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