Relating to a study regarding the reenactment of the franchise tax credit or providing other incentives for certain research and development activities.
Should the recommendations of this study favor the reinstitution of the franchise tax credit, it could lead to updates in Texas state tax law, particularly in the realm of economic incentives. The bill's findings may encourage the Texas legislature to consider new tax structures or reforms that could benefit enterprises engaged in research and development. This could potentially foster growth within innovative sectors by creating a more favorable tax environment.
House Bill 2383 aims to initiate a study conducted by the Legislative Budget Board regarding the reenactment of the franchise tax credit previously available under Subchapter O of the Texas Tax Code. This credit was repealed by prior legislation in 2006, and the bill seeks to assess the potential costs and benefits of reinstating such a credit. In addition to this evaluation, the bill also tasks the Legislative Budget Board with researching other states' incentives for research and development activities, providing a broader context for potential Texas policies.
While HB2383 is primarily a study bill, it might bring forth discussions around fiscal policy concerning tax credits and incentives. Stakeholders, including businesses and state agencies, may have differing opinions on the efficacy of such credits, especially in light of previous budgetary constraints or the economic climate. Critics might raise concerns about the potential loss of revenue versus the economic benefits highlighted by sponsors of the bill, which could lead to a nuanced dialogue on whether similar incentives should be reintroduced.