Texas House Bill HB2910

Texas 2015 - 84th Regular

Caption

Relating to a sales and use tax exemption for certain equipment used for mineral exploration and production.

Impact

The enactment of HB 2910 could significantly impact state laws governing taxation on equipment linked to mineral resources. By exempting certain drilling and fracturing equipment from sales and use tax, the Texas legislature aims to enhance competitiveness for companies engaged in oil and gas exploration and extraction. While this could lead to increased investment and activity in the mineral sector, it may also reduce state tax revenues derived from equipment sales in the short term.

Summary

House Bill 2910 is a legislative proposal focused on amending the Texas Tax Code to provide a sales and use tax exemption for certain equipment used in mineral exploration and production. Specifically, the bill targets drilling and fracturing equipment, including blenders and pumping systems, which are utilized exclusively outside of Texas. This bill is intended to promote the oil and gas sector by reducing the tax burden associated with acquiring essential equipment for these industries.

Contention

While the bill appears to have the potential for economic growth in the mineral exploration sector, it may also raise concerns among fiscal watchdogs and local governments regarding the broader implications of tax exemptions on state revenues. Though specific opposition to the bill is not detailed in available documents, discussions around similar bills often highlight debates over tax fairness and the equitable distribution of tax burdens among industries. Stakeholders may argue about the effectiveness of such tax breaks in bolstering economic activities versus the lost potential revenue for statewide services.