LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE, 81ST LEGISLATIVE REGULAR SESSION May 27, 2009 TO: Honorable David Dewhurst, Lieutenant Governor, Senate FROM: John S. O'Brien, Director, Legislative Budget Board IN RE:SB958 by Hegar (Relating to an exemption from the sales and use tax for machinery and equipment used in an agricultural aircraft operation.), As Passed 2nd House Estimated Two-year Net Impact to General Revenue Related Funds for SB958, As Passed 2nd House: a negative impact of ($1,000,000) through the biennium ending August 31, 2011.
LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 81ST LEGISLATIVE REGULAR SESSION
May 27, 2009
TO: Honorable David Dewhurst, Lieutenant Governor, Senate FROM: John S. O'Brien, Director, Legislative Budget Board IN RE:SB958 by Hegar (Relating to an exemption from the sales and use tax for machinery and equipment used in an agricultural aircraft operation.), As Passed 2nd House
TO: Honorable David Dewhurst, Lieutenant Governor, Senate
FROM: John S. O'Brien, Director, Legislative Budget Board
IN RE: SB958 by Hegar (Relating to an exemption from the sales and use tax for machinery and equipment used in an agricultural aircraft operation.), As Passed 2nd House
Honorable David Dewhurst, Lieutenant Governor, Senate
Honorable David Dewhurst, Lieutenant Governor, Senate
John S. O'Brien, Director, Legislative Budget Board
John S. O'Brien, Director, Legislative Budget Board
SB958 by Hegar (Relating to an exemption from the sales and use tax for machinery and equipment used in an agricultural aircraft operation.), As Passed 2nd House
SB958 by Hegar (Relating to an exemption from the sales and use tax for machinery and equipment used in an agricultural aircraft operation.), As Passed 2nd House
Estimated Two-year Net Impact to General Revenue Related Funds for SB958, As Passed 2nd House: a negative impact of ($1,000,000) through the biennium ending August 31, 2011.
Estimated Two-year Net Impact to General Revenue Related Funds for SB958, As Passed 2nd House: a negative impact of ($1,000,000) through the biennium ending August 31, 2011.
General Revenue-Related Funds, Five-Year Impact: Fiscal Year Probable Net Positive/(Negative) Impact to General Revenue Related Funds 2010 ($500,000) 2011 ($500,000) 2012 ($500,000) 2013 ($500,000) 2014 ($500,000)
2010 ($500,000)
2011 ($500,000)
2012 ($500,000)
2013 ($500,000)
2014 ($500,000)
All Funds, Five-Year Impact: Fiscal Year Probable Revenue (Loss) fromGeneral Revenue Fund1 Probable Revenue (Loss) fromCities Probable Revenue (Loss) fromTransit Authorities Probable Revenue (Loss) fromCounties 2010 ($500,000) ($93,000) ($32,000) ($13,000) 2011 ($500,000) ($93,000) ($32,000) ($13,000) 2012 ($500,000) ($93,000) ($32,000) ($13,000) 2013 ($500,000) ($93,000) ($32,000) ($13,000) 2014 ($500,000) ($93,000) ($32,000) ($13,000)
Fiscal Year Probable Revenue (Loss) fromGeneral Revenue Fund1 Probable Revenue (Loss) fromCities Probable Revenue (Loss) fromTransit Authorities Probable Revenue (Loss) fromCounties 2010 ($500,000) ($93,000) ($32,000) ($13,000) 2011 ($500,000) ($93,000) ($32,000) ($13,000) 2012 ($500,000) ($93,000) ($32,000) ($13,000) 2013 ($500,000) ($93,000) ($32,000) ($13,000) 2014 ($500,000) ($93,000) ($32,000) ($13,000)
2010 ($500,000) ($93,000) ($32,000) ($13,000)
2011 ($500,000) ($93,000) ($32,000) ($13,000)
2012 ($500,000) ($93,000) ($32,000) ($13,000)
2013 ($500,000) ($93,000) ($32,000) ($13,000)
2014 ($500,000) ($93,000) ($32,000) ($13,000)
Fiscal Analysis
The bill would amend Chapter 151 of the Tax Code, regarding certain sales tax exemptions. The bill would add machinery and equipment exclusively used in an agricultural aircraft operation to the list of agricultural items that are exempt from the sales tax. The bill would create a sales tax exemption for aircraft sold for use primarily in connection with an agricultural use including predator control; wildlife or livestock capture; wildlife or livestock surveys; census counts of livestock or wildlife; animal or plant health inspection services; or crop dusting, pollination, or seeding. The bill would take effect September 1, 2009.
The bill would amend Chapter 151 of the Tax Code, regarding certain sales tax exemptions.
The bill would add machinery and equipment exclusively used in an agricultural aircraft operation to the list of agricultural items that are exempt from the sales tax.
The bill would create a sales tax exemption for aircraft sold for use primarily in connection with an agricultural use including predator control; wildlife or livestock capture; wildlife or livestock surveys; census counts of livestock or wildlife; animal or plant health inspection services; or crop dusting, pollination, or seeding.
The bill would take effect September 1, 2009.
Methodology
The section of the bill regarding the exemption for machinery and equipment used in an agricultural aircraft operation (Section 151.316 of the Tax Code) would codify current Comptroller policy regarding agricultural aircraft. The proposed change would have no fiscal impact. The section of the bill regarding the exemption for aircraft (Section 151.328 of the Tax Code) is not a clarification of existing law and would broaden the sales tax exemption for aircraft. The revenue loss shown in the table above represents the broadening of this exemption. Sales of aircraft sold primarily for use in relation to certain agricultural or wildlife activities were estimated based on data gathered from Comptroller tax files. Sales were multiplied by the state sales tax rate and extrapolated through fiscal 2014.
The section of the bill regarding the exemption for machinery and equipment used in an agricultural aircraft operation (Section 151.316 of the Tax Code) would codify current Comptroller policy regarding agricultural aircraft. The proposed change would have no fiscal impact.
The section of the bill regarding the exemption for aircraft (Section 151.328 of the Tax Code) is not a clarification of existing law and would broaden the sales tax exemption for aircraft. The revenue loss shown in the table above represents the broadening of this exemption. Sales of aircraft sold primarily for use in relation to certain agricultural or wildlife activities were estimated based on data gathered from Comptroller tax files. Sales were multiplied by the state sales tax rate and extrapolated through fiscal 2014.
Local Government Impact
There would be a proportional loss of sales tax revenue to units of local government.
Source Agencies:
LBB Staff: JOB, MN, KK
JOB, MN, KK