LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE, 81ST LEGISLATIVE REGULAR SESSION April 19, 2009 TO: Honorable Rene Oliveira, Chair, House Committee on Ways & Means FROM: John S. O'Brien, Director, Legislative Budget Board IN RE:HB3895 by Oliveira (Relating to the sales tax on computer program services.), As Introduced Estimated Two-year Net Impact to General Revenue Related Funds for HB3895, As Introduced: a positive impact of $289,630,000 through the biennium ending August 31, 2011, if the effective date of the bill is July 1, 2009; or a positive impact of $256,403,000 through the biennium ending August 31, 2011, if the effective date of the bill is October 1, 2009.
LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 81ST LEGISLATIVE REGULAR SESSION
April 19, 2009
TO: Honorable Rene Oliveira, Chair, House Committee on Ways & Means FROM: John S. O'Brien, Director, Legislative Budget Board IN RE:HB3895 by Oliveira (Relating to the sales tax on computer program services.), As Introduced
TO: Honorable Rene Oliveira, Chair, House Committee on Ways & Means
FROM: John S. O'Brien, Director, Legislative Budget Board
IN RE: HB3895 by Oliveira (Relating to the sales tax on computer program services.), 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
HB3895 by Oliveira (Relating to the sales tax on computer program services.), As Introduced
HB3895 by Oliveira (Relating to the sales tax on computer program services.), As Introduced
Estimated Two-year Net Impact to General Revenue Related Funds for HB3895, As Introduced: a positive impact of $289,630,000 through the biennium ending August 31, 2011, if the effective date of the bill is July 1, 2009; or a positive impact of $256,403,000 through the biennium ending August 31, 2011, if the effective date of the bill is October 1, 2009.
Estimated Two-year Net Impact to General Revenue Related Funds for HB3895, As Introduced: a positive impact of $289,630,000 through the biennium ending August 31, 2011, if the effective date of the bill is July 1, 2009; or a positive impact of $256,403,000 through the biennium ending August 31, 2011, if the effective date of the bill is October 1, 2009.
General Revenue-Related Funds, Six-Year Impact: Fiscal Year Probable Net Positive/(Negative) Impact to General Revenue Related Funds 2009 $10,648,000 2010 $135,472,000 2011 $143,510,000 2012 $152,266,000 2013 $160,941,000 2014 $169,954,000
2009 $10,648,000
2010 $135,472,000
2011 $143,510,000
2012 $152,266,000
2013 $160,941,000
2014 $169,954,000
General Revenue-Related Funds, Five-Year Impact: Fiscal Year Probable Net Positive/(Negative) Impact to General Revenue Related Funds 2010 $112,893,000 2011 $143,510,000 2012 $152,266,000 2013 $160,941,000 2014 $169,954,000
2010 $112,893,000
2011 $143,510,000
2012 $152,266,000
2013 $160,941,000
2014 $169,954,000
All Funds, Six-Year Impact: Fiscal Year Probable Revenue Gain fromGeneral Revenue Fund1 Probable Revenue Gain fromCities Probable Revenue Gain fromTransit Authorities Probable Revenue Gain fromCounties 2009 $10,648,000 $0 $0 $0 2010 $135,472,000 $25,195,000 $8,714,000 $3,560,000 2011 $143,510,000 $26,690,000 $9,231,000 $3,771,000 2012 $152,266,000 $28,318,000 $9,794,000 $4,002,000 2013 $160,941,000 $29,932,000 $10,352,000 $4,230,000 2014 $169,954,000 $31,608,000 $10,931,000 $4,466,000 The above table assumes an effective date of July 1, 2009. The table below assumes an effective date of October 1, 2009. Fiscal Year Probable Revenue Gain fromGeneral Revenue Fund1 Probable Revenue Gain fromCities Probable Revenue Gain fromTransit Authorities Probable Revenue Gain fromCounties 2010 $112,893,000 $18,896,000 $6,535,000 $2,670,000 2011 $143,510,000 $26,960,000 $9,231,000 $3,771,000 2012 $152,266,000 $28,318,000 $9,794,000 $4,002,000 2013 $160,941,000 $29,932,000 $10,352,000 $4,230,000 2014 $169,954,000 $31,608,000 $10,931,000 $4,466,000 Fiscal Analysis The bill would amend Chapter 151 of the Tax Code, regarding the sales tax. The bill would eliminate the sales tax exception for the repair, maintenance, creation, and restoration of computer programs from the definition of "taxable services." Under this bill, these services would become subject to taxation. The bill would take effect July 1, 2009, assuming that it received the requisite two-thirds majority votes in both houses of the Legislature. Otherwise, it would take effect October 1, 2009. Methodology The fiscal impact was estimated based on data on the Texas sale of custom computer programming services gathered from the U.S. Bureau of the Census. Sales were multiplied by the state sales tax rate; adjusted for potential effective dates of July 1, 2009 and October 1, 2009; and extrapolated through fiscal 2014. Local Government Impact There would be a proportional gain of sales tax revenue to units of local government. Source Agencies:304 Comptroller of Public Accounts LBB Staff: JOB, MN, SD, KK
Fiscal Year Probable Revenue Gain fromGeneral Revenue Fund1 Probable Revenue Gain fromCities Probable Revenue Gain fromTransit Authorities Probable Revenue Gain fromCounties 2009 $10,648,000 $0 $0 $0 2010 $135,472,000 $25,195,000 $8,714,000 $3,560,000 2011 $143,510,000 $26,690,000 $9,231,000 $3,771,000 2012 $152,266,000 $28,318,000 $9,794,000 $4,002,000 2013 $160,941,000 $29,932,000 $10,352,000 $4,230,000 2014 $169,954,000 $31,608,000 $10,931,000 $4,466,000
2009 $10,648,000 $0 $0 $0
2010 $135,472,000 $25,195,000 $8,714,000 $3,560,000
2011 $143,510,000 $26,690,000 $9,231,000 $3,771,000
2012 $152,266,000 $28,318,000 $9,794,000 $4,002,000
2013 $160,941,000 $29,932,000 $10,352,000 $4,230,000
2014 $169,954,000 $31,608,000 $10,931,000 $4,466,000
The above table assumes an effective date of July 1, 2009. The table below assumes an effective date of October 1, 2009.
Fiscal Year Probable Revenue Gain fromGeneral Revenue Fund1 Probable Revenue Gain fromCities Probable Revenue Gain fromTransit Authorities Probable Revenue Gain fromCounties 2010 $112,893,000 $18,896,000 $6,535,000 $2,670,000 2011 $143,510,000 $26,960,000 $9,231,000 $3,771,000 2012 $152,266,000 $28,318,000 $9,794,000 $4,002,000 2013 $160,941,000 $29,932,000 $10,352,000 $4,230,000 2014 $169,954,000 $31,608,000 $10,931,000 $4,466,000 Fiscal Analysis The bill would amend Chapter 151 of the Tax Code, regarding the sales tax. The bill would eliminate the sales tax exception for the repair, maintenance, creation, and restoration of computer programs from the definition of "taxable services." Under this bill, these services would become subject to taxation. The bill would take effect July 1, 2009, assuming that it received the requisite two-thirds majority votes in both houses of the Legislature. Otherwise, it would take effect October 1, 2009. Methodology The fiscal impact was estimated based on data on the Texas sale of custom computer programming services gathered from the U.S. Bureau of the Census. Sales were multiplied by the state sales tax rate; adjusted for potential effective dates of July 1, 2009 and October 1, 2009; and extrapolated through fiscal 2014.
Fiscal Year Probable Revenue Gain fromGeneral Revenue Fund1 Probable Revenue Gain fromCities Probable Revenue Gain fromTransit Authorities Probable Revenue Gain fromCounties 2010 $112,893,000 $18,896,000 $6,535,000 $2,670,000 2011 $143,510,000 $26,960,000 $9,231,000 $3,771,000 2012 $152,266,000 $28,318,000 $9,794,000 $4,002,000 2013 $160,941,000 $29,932,000 $10,352,000 $4,230,000 2014 $169,954,000 $31,608,000 $10,931,000 $4,466,000
2010 $112,893,000 $18,896,000 $6,535,000 $2,670,000
2011 $143,510,000 $26,960,000 $9,231,000 $3,771,000
2012 $152,266,000 $28,318,000 $9,794,000 $4,002,000
2013 $160,941,000 $29,932,000 $10,352,000 $4,230,000
2014 $169,954,000 $31,608,000 $10,931,000 $4,466,000
Fiscal Analysis
The bill would amend Chapter 151 of the Tax Code, regarding the sales tax. The bill would eliminate the sales tax exception for the repair, maintenance, creation, and restoration of computer programs from the definition of "taxable services." Under this bill, these services would become subject to taxation. The bill would take effect July 1, 2009, assuming that it received the requisite two-thirds majority votes in both houses of the Legislature. Otherwise, it would take effect October 1, 2009.
The bill would amend Chapter 151 of the Tax Code, regarding the sales tax.
The bill would eliminate the sales tax exception for the repair, maintenance, creation, and restoration of computer programs from the definition of "taxable services." Under this bill, these services would become subject to taxation.
The bill would take effect July 1, 2009, assuming that it received the requisite two-thirds majority votes in both houses of the Legislature. Otherwise, it would take effect October 1, 2009.
Methodology
The fiscal impact was estimated based on data on the Texas sale of custom computer programming services gathered from the U.S. Bureau of the Census. Sales were multiplied by the state sales tax rate; adjusted for potential effective dates of July 1, 2009 and October 1, 2009; and extrapolated through fiscal 2014.
Local Government Impact
There would be a proportional gain of sales tax revenue to units of local government.
Source Agencies: 304 Comptroller of Public Accounts
304 Comptroller of Public Accounts
LBB Staff: JOB, MN, SD, KK
JOB, MN, SD, KK