LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE, 82ND LEGISLATIVE REGULAR SESSION April 8, 2011 TO: Honorable Harvey Hilderbran, Chair, House Committee on Ways & Means FROM: John S O'Brien, Director, Legislative Budget Board IN RE:HB262 by Hilderbran (Relating to the retention of the $1 million total revenue exemption for the franchise tax.), As Introduced Estimated Two-year Net Impact to General Revenue Related Funds for HB262, As Introduced: an impact of $0 through the biennium ending August 31, 2013. The bill will have a direct impact of a revenue loss to the Property Tax Relief Fund beginning in fiscal year 2012. Any loss to the Property Tax Relief Fund will have to be made up with General Revenue of the same amount to fund property tax relief.
LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 82ND LEGISLATIVE REGULAR SESSION
April 8, 2011
TO: Honorable Harvey Hilderbran, Chair, House Committee on Ways & Means FROM: John S O'Brien, Director, Legislative Budget Board IN RE:HB262 by Hilderbran (Relating to the retention of the $1 million total revenue exemption for the franchise tax.), As Introduced
TO: Honorable Harvey Hilderbran, Chair, House Committee on Ways & Means
FROM: John S O'Brien, Director, Legislative Budget Board
IN RE: HB262 by Hilderbran (Relating to the retention of the $1 million total revenue exemption for the franchise tax.), As Introduced
Honorable Harvey Hilderbran, Chair, House Committee on Ways & Means
Honorable Harvey Hilderbran, Chair, House Committee on Ways & Means
John S O'Brien, Director, Legislative Budget Board
John S O'Brien, Director, Legislative Budget Board
HB262 by Hilderbran (Relating to the retention of the $1 million total revenue exemption for the franchise tax.), As Introduced
HB262 by Hilderbran (Relating to the retention of the $1 million total revenue exemption for the franchise tax.), As Introduced
Estimated Two-year Net Impact to General Revenue Related Funds for HB262, As Introduced: an impact of $0 through the biennium ending August 31, 2013. The bill will have a direct impact of a revenue loss to the Property Tax Relief Fund beginning in fiscal year 2012. Any loss to the Property Tax Relief Fund will have to be made up with General Revenue of the same amount to fund property tax relief.
Estimated Two-year Net Impact to General Revenue Related Funds for HB262, As Introduced: an impact of $0 through the biennium ending August 31, 2013.
The bill will have a direct impact of a revenue loss to the Property Tax Relief Fund beginning in fiscal year 2012. Any loss to the Property Tax Relief Fund will have to be made up with General Revenue of the same amount to fund property tax relief.
General Revenue-Related Funds, Five-Year Impact: Fiscal Year Probable Net Positive/(Negative) Impact to General Revenue Related Funds 2012 $0 2013 $0 2014 $0 2015 $0 2016 $0
2012 $0
2013 $0
2014 $0
2015 $0
2016 $0
All Funds, Five-Year Impact: Fiscal Year Probable Revenue (Loss) fromProperty Tax Relief Fund304 2012 ($73,900,000) 2013 ($76,000,000) 2014 ($77,600,000) 2015 ($77,800,000) 2016 ($78,400,000)
Fiscal Year Probable Revenue (Loss) fromProperty Tax Relief Fund304 2012 ($73,900,000) 2013 ($76,000,000) 2014 ($77,600,000) 2015 ($77,800,000) 2016 ($78,400,000)
2012 ($73,900,000)
2013 ($76,000,000)
2014 ($77,600,000)
2015 ($77,800,000)
2016 ($78,400,000)
Fiscal Analysis
The bill would amend Chapter 171 of the Tax Code, regarding the franchise tax, by increasing the amount of total revenue at which a taxable entity would owe no tax. The amount in current law effective for reports due in 2012 and later is $600,000. This bill would raise the amount to $1,000,000 subject to the adjustment provided in Section 171.006. The bill would accomplish the change in law by repealing provisions in current law that reset the total revenue amount for no tax due to $600,000 from $1,000,000 for reports due after January 1, 2012. This bill would take effect immediately upon enactment, assuming that it received the requisite two-thirds majority votes in both houses of the Legislature. Otherwise, it would take effect September 1, 2011.
Methodology
The estimated fiscal impact of the bill is based on data reported on the 2009 franchise tax reports from taxable entities with total revenue between $600,000 and $1,000,000. The estimated fiscal impact would be the same for immediate effect or for a September 1, 2011 effective date.
Local Government Impact
No significant fiscal implication to units of local government is anticipated.
Source Agencies: 304 Comptroller of Public Accounts
304 Comptroller of Public Accounts
LBB Staff: JOB, KK, SD
JOB, KK, SD