83R9161 TJB-F
By: Lozano H.B. No. 2047
A BILL TO BE ENTITLED
AN ACT
relating to a sales and use tax exemption for certain tangible
personal property and services related to mineral exploration and
production.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 151.324(a), Tax Code, is amended to read
as follows:
(a) The following items are exempted from the sales tax
imposed by Subchapter C of this chapter:
(1) drill pipe, casing, tubing, and other pipe used
for the exploration for or production of oil, gas, sulphur, or other
minerals offshore not in this state; [and]
(2) tangible personal property exclusively used for
the exploration for or production of oil, gas, sulphur, or other
minerals offshore not in this state;
(3) machinery used to position, place, and hold
property exempted under Subdivision (1) or (2) during the assembly,
fabrication, restoration, or repair of that property; and
(4) services necessary to install, assemble,
disassemble, or reassemble scaffolding used in the assembly,
fabrication, restoration, or repair of property exempted under
Subdivision (1), (2), or (3).
SECTION 2. Subchapter H, Chapter 151, Tax Code, is amended
by adding Section 151.3241 to read as follows:
Sec. 151.3241. DIVERGENT USE OF MACHINERY RELATED TO
MINERAL EXPLORATION AND PRODUCTION. (a) In this section,
"divergent use" means the use of machinery in a manner or for a
purpose other than the manner or purpose that qualified the sale,
use, or consumption of the machinery for exemption under Section
151.324(a)(3).
(b) Divergent use of machinery exempted under Section
151.324(a)(3) will not result in sales and use tax being due on the
machinery if the divergent use occurs after the fourth anniversary
of the date the machinery is purchased.
(c) Divergent use of machinery exempted under Section
151.324(a)(3) that occurs during any month before the fourth
anniversary of the date the machinery is purchased results in sales
and use tax being due for that month. The amount of the sales and use
tax due for a month is equal to 1/48 of the purchase price of the
machinery multiplied by the percentage of divergent use during that
month multiplied by the sales and use tax rate as of the first day of
that month.
(d) The percentage of divergent use for a month is
determined by dividing the amount of divergent use during the month
by the amount of total use of the machinery during the month. The
amount of divergent use during a month is the total time the
machinery operates for a divergent use during the month, measured
in hours. The total use of the machinery during the month is the
total time the machinery is operated during the month, measured in
hours.
SECTION 3. The change in law made by this Act does not
affect tax liability accruing before the effective date of this
Act. That liability continues in effect as if this Act had not been
enacted, and the former law is continued in effect for the
collection of taxes due and for civil and criminal enforcement of
the liability for those taxes.
SECTION 4. This Act takes effect September 1, 2013.