| 1 | 1 | | 81R7790 BEF-F |
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| 2 | 2 | | By: Shapiro S.B. No. 1444 |
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| 3 | 3 | | |
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| 4 | 4 | | |
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| 5 | 5 | | A BILL TO BE ENTITLED |
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| 6 | 6 | | AN ACT |
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| 7 | 7 | | relating to exempting the sale of certain property used for |
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| 8 | 8 | | research and development from the sales tax. |
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| 9 | 9 | | BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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| 10 | 10 | | SECTION 1. Subchapter H, Chapter 151, Tax Code, is amended |
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| 11 | 11 | | by adding Section 151.3182 to read as follows: |
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| 12 | 12 | | Sec. 151.3182. EQUIPMENT USED IN RESEARCH OR DEVELOPMENT. |
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| 13 | 13 | | (a) In this section: |
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| 14 | 14 | | (1) "Manufacturing" has the meaning assigned that term |
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| 15 | 15 | | by Section 151.318. |
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| 16 | 16 | | (2) "Telecommunications services" has the meaning |
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| 17 | 17 | | assigned that term by Section 151.0103. |
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| 18 | 18 | | (b) Except as provided by Subsection (d), the sale, use, or |
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| 19 | 19 | | other consumption of tangible personal property is exempted from |
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| 20 | 20 | | the taxes imposed by this chapter and a taxpayer may claim a credit |
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| 21 | 21 | | or refund under Subsection (e) if the tangible personal property is |
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| 22 | 22 | | used directly in the research or development of inventions, |
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| 23 | 23 | | products, processes, or technology by a person that is primarily |
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| 24 | 24 | | engaged in: |
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| 25 | 25 | | (1) the manufacturing, processing, or fabrication of |
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| 26 | 26 | | tangible personal property for ultimate sale; |
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| 27 | 27 | | (2) the provision of telecommunications services; or |
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| 28 | 28 | | (3) the performance of scientific or technical |
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| 29 | 29 | | services for a person primarily engaged in an activity described by |
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| 30 | 30 | | Subdivision (1) or (2). |
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| 31 | 31 | | (c) This section applies to tangible personal property used |
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| 32 | 32 | | or consumed in research or development by persons primarily engaged |
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| 33 | 33 | | in manufacturing or the provision of telecommunications services |
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| 34 | 34 | | regardless of whether the tangible personal property: |
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| 35 | 35 | | (1) is used or consumed in the actual manufacturing, |
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| 36 | 36 | | processing, or fabrication of tangible personal property for |
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| 37 | 37 | | ultimate sale; or |
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| 38 | 38 | | (2) is directly used in the provision of |
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| 39 | 39 | | telecommunications services. |
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| 40 | 40 | | (d) This section does not apply to: |
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| 41 | 41 | | (1) office equipment or supplies; or |
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| 42 | 42 | | (2) equipment or supplies used in sales or |
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| 43 | 43 | | distribution activities or in transportation activities. |
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| 44 | 44 | | (e) A taxpayer who pays tax on tangible personal property |
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| 45 | 45 | | exempted under this section is entitled to either a credit of the |
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| 46 | 46 | | amount paid against taxes owed under this chapter or a refund of the |
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| 47 | 47 | | amount paid. A taxpayer who elects a credit must claim the credit |
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| 48 | 48 | | on the return for a period that ends not later than the first |
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| 49 | 49 | | anniversary of the date on which the tax on the item was paid. A |
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| 50 | 50 | | taxpayer who elects a refund must apply to the comptroller for the |
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| 51 | 51 | | refund before or during the calendar year following the year in |
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| 52 | 52 | | which the tax on the item was paid. |
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| 53 | 53 | | SECTION 2. The changes in law made by this Act do not affect |
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| 54 | 54 | | tax liability accruing before the effective date of this Act. That |
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| 55 | 55 | | liability continues in effect as if this Act had not been enacted, |
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| 56 | 56 | | and the former law is continued in effect for the collection of |
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| 57 | 57 | | taxes due and for civil and criminal enforcement of the liability |
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| 58 | 58 | | for those taxes. |
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| 59 | 59 | | SECTION 3. This Act takes effect October 1, 2009. |
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