LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE, 84TH LEGISLATIVE REGULAR SESSION April 22, 2015 TO: Honorable Jane Nelson, Chair, Senate Committee on Finance FROM: Ursula Parks, Director, Legislative Budget Board IN RE:SB228 by Creighton (relating to an exemption from the sales tax for firearms and hunting supplies for a limited period.), Committee Report 1st House, Substituted Estimated Two-year Net Impact to General Revenue Related Funds for SB228, Committee Report 1st House, Substituted: a negative impact of ($11,120,000) through the biennium ending August 31, 2017, if the bill takes immediate effect; or a negative impact of ($11,120,000) through the biennium ending August 31, 2017, if the effective date of the bill is September 1, 2015.
LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 84TH LEGISLATIVE REGULAR SESSION
April 22, 2015
TO: Honorable Jane Nelson, Chair, Senate Committee on Finance FROM: Ursula Parks, Director, Legislative Budget Board IN RE:SB228 by Creighton (relating to an exemption from the sales tax for firearms and hunting supplies for a limited period.), Committee Report 1st House, Substituted
TO: Honorable Jane Nelson, Chair, Senate Committee on Finance
FROM: Ursula Parks, Director, Legislative Budget Board
IN RE: SB228 by Creighton (relating to an exemption from the sales tax for firearms and hunting supplies for a limited period.), Committee Report 1st House, Substituted
Honorable Jane Nelson, Chair, Senate Committee on Finance
Honorable Jane Nelson, Chair, Senate Committee on Finance
Ursula Parks, Director, Legislative Budget Board
Ursula Parks, Director, Legislative Budget Board
SB228 by Creighton (relating to an exemption from the sales tax for firearms and hunting supplies for a limited period.), Committee Report 1st House, Substituted
SB228 by Creighton (relating to an exemption from the sales tax for firearms and hunting supplies for a limited period.), Committee Report 1st House, Substituted
Estimated Two-year Net Impact to General Revenue Related Funds for SB228, Committee Report 1st House, Substituted: a negative impact of ($11,120,000) through the biennium ending August 31, 2017, if the bill takes immediate effect; or a negative impact of ($11,120,000) through the biennium ending August 31, 2017, if the effective date of the bill is September 1, 2015.
Estimated Two-year Net Impact to General Revenue Related Funds for SB228, Committee Report 1st House, Substituted: a negative impact of ($11,120,000) through the biennium ending August 31, 2017, if the bill takes immediate effect; or a negative impact of ($11,120,000) through the biennium ending August 31, 2017, if the effective date of the bill is September 1, 2015.
General Revenue-Related Funds, Six-Year Impact: Fiscal Year Probable Net Positive/(Negative) Impact to General Revenue Related Funds 2015 ($390,000) 2016 ($5,230,000) 2017 ($5,500,000) 2018 ($5,770,000) 2019 ($6,060,000) 2020 ($6,360,000)
2015 ($390,000)
2016 ($5,230,000)
2017 ($5,500,000)
2018 ($5,770,000)
2019 ($6,060,000)
2020 ($6,360,000)
General Revenue-Related Funds, Five-Year Impact: Fiscal Year Probable Net Positive/(Negative) Impact to General Revenue Related Funds 2016 ($5,620,000) 2017 ($5,500,000) 2018 ($5,770,000) 2019 ($6,060,000) 2020 ($6,360,000)
2016 ($5,620,000)
2017 ($5,500,000)
2018 ($5,770,000)
2019 ($6,060,000)
2020 ($6,360,000)
All Funds, Six-Year Impact: Fiscal Year Probable Revenue (Loss) fromGeneral Revenue Fund1 Probable Revenue (Loss) fromCities Probable Revenue (Loss) fromTransit Authorities Probable Revenue (Loss) fromCounties and Special Districts 2015 ($390,000) ($70,000) ($20,000) ($10,000) 2016 ($5,230,000) ($960,000) ($330,000) ($180,000) 2017 ($5,500,000) ($1,010,000) ($350,000) ($190,000) 2018 ($5,770,000) ($1,060,000) ($360,000) ($200,000) 2019 ($6,060,000) ($1,120,000) ($380,000) ($210,000) 2020 ($6,360,000) ($1,170,000) ($400,000) ($220,000) The table above assumes the bill takes immediate effect. The table below assumes the bill takes effect on September 1, 2015. Fiscal Year Probable Revenue (Loss) fromGeneral Revenue Fund1 Probable Revenue (Loss) fromCities Probable Revenue (Loss) fromTransit Authorities Probable Revenue (Loss) fromCounties and Special Districts 2016 ($5,620,000) ($1,030,000) ($350,000) ($190,000) 2017 ($5,500,000) ($1,010,000) ($350,000) ($190,000) 2018 ($5,770,000) ($1,060,000) ($360,000) ($200,000) 2019 ($6,060,000) ($1,120,000) ($380,000) ($210,000) 2020 ($6,360,000) ($1,170,000) ($400,000) ($220,000) Fiscal Analysis The bill would amend Chapter 151 of the Tax Code, to provide for an exemption from sales tax of a firearm or hunting supplies if the sale takes place either 1) beginning with the Saturday of the last full weekend in August and ending with the following Sunday, or 2) beginning on the Saturday of the last full weekend in October and ending with the following Sunday. The term "hunting supplies" would include ammunition, archery equipment, hunting blinds and stands, hunting decoys, firearm cleaning supplies, gun cases, gun safes, hunting optics, and hunting safety equipment. In the event the bill fails to take immediate effect, there is provision for a tax exemption period during the first weekend in September rather than the last weekend in August in 2015. The bill would take effect immediately upon enactment, assuming it received the requisite two-thirds majority votes in both houses of the Legislature. Otherwise, it would take effect September 1, 2015. Methodology National and regional data on annual firearm and hunting supplies sales from an annual report issued by the National Sporting Goods Association was apportioned to the state based on population, adjusted for the portion that would likely occur during the exemption periods, multiplied by the state sales tax rate, and extrapolated through 2020.To the extent spending on other items, including hunting licenses, is induced by this sales tax holiday, there may be some offsetting increase in revenue. This amount, however, cannot be estimated. Local Government Impact There would be a proportional loss of sales and use tax revenue from local taxing jurisdictions. Source Agencies:304 Comptroller of Public Accounts LBB Staff: UP, KK, SD
Fiscal Year Probable Revenue (Loss) fromGeneral Revenue Fund1 Probable Revenue (Loss) fromCities Probable Revenue (Loss) fromTransit Authorities Probable Revenue (Loss) fromCounties and Special Districts 2015 ($390,000) ($70,000) ($20,000) ($10,000) 2016 ($5,230,000) ($960,000) ($330,000) ($180,000) 2017 ($5,500,000) ($1,010,000) ($350,000) ($190,000) 2018 ($5,770,000) ($1,060,000) ($360,000) ($200,000) 2019 ($6,060,000) ($1,120,000) ($380,000) ($210,000) 2020 ($6,360,000) ($1,170,000) ($400,000) ($220,000)
2015 ($390,000) ($70,000) ($20,000) ($10,000)
2016 ($5,230,000) ($960,000) ($330,000) ($180,000)
2017 ($5,500,000) ($1,010,000) ($350,000) ($190,000)
2018 ($5,770,000) ($1,060,000) ($360,000) ($200,000)
2019 ($6,060,000) ($1,120,000) ($380,000) ($210,000)
2020 ($6,360,000) ($1,170,000) ($400,000) ($220,000)
The table above assumes the bill takes immediate effect. The table below assumes the bill takes effect on September 1, 2015.
Fiscal Year Probable Revenue (Loss) fromGeneral Revenue Fund1 Probable Revenue (Loss) fromCities Probable Revenue (Loss) fromTransit Authorities Probable Revenue (Loss) fromCounties and Special Districts 2016 ($5,620,000) ($1,030,000) ($350,000) ($190,000) 2017 ($5,500,000) ($1,010,000) ($350,000) ($190,000) 2018 ($5,770,000) ($1,060,000) ($360,000) ($200,000) 2019 ($6,060,000) ($1,120,000) ($380,000) ($210,000) 2020 ($6,360,000) ($1,170,000) ($400,000) ($220,000) Fiscal Analysis The bill would amend Chapter 151 of the Tax Code, to provide for an exemption from sales tax of a firearm or hunting supplies if the sale takes place either 1) beginning with the Saturday of the last full weekend in August and ending with the following Sunday, or 2) beginning on the Saturday of the last full weekend in October and ending with the following Sunday. The term "hunting supplies" would include ammunition, archery equipment, hunting blinds and stands, hunting decoys, firearm cleaning supplies, gun cases, gun safes, hunting optics, and hunting safety equipment. In the event the bill fails to take immediate effect, there is provision for a tax exemption period during the first weekend in September rather than the last weekend in August in 2015. The bill would take effect immediately upon enactment, assuming it received the requisite two-thirds majority votes in both houses of the Legislature. Otherwise, it would take effect September 1, 2015. Methodology National and regional data on annual firearm and hunting supplies sales from an annual report issued by the National Sporting Goods Association was apportioned to the state based on population, adjusted for the portion that would likely occur during the exemption periods, multiplied by the state sales tax rate, and extrapolated through 2020.To the extent spending on other items, including hunting licenses, is induced by this sales tax holiday, there may be some offsetting increase in revenue. This amount, however, cannot be estimated.
Fiscal Year Probable Revenue (Loss) fromGeneral Revenue Fund1 Probable Revenue (Loss) fromCities Probable Revenue (Loss) fromTransit Authorities Probable Revenue (Loss) fromCounties and Special Districts 2016 ($5,620,000) ($1,030,000) ($350,000) ($190,000) 2017 ($5,500,000) ($1,010,000) ($350,000) ($190,000) 2018 ($5,770,000) ($1,060,000) ($360,000) ($200,000) 2019 ($6,060,000) ($1,120,000) ($380,000) ($210,000) 2020 ($6,360,000) ($1,170,000) ($400,000) ($220,000)
2016 ($5,620,000) ($1,030,000) ($350,000) ($190,000)
2017 ($5,500,000) ($1,010,000) ($350,000) ($190,000)
2018 ($5,770,000) ($1,060,000) ($360,000) ($200,000)
2019 ($6,060,000) ($1,120,000) ($380,000) ($210,000)
2020 ($6,360,000) ($1,170,000) ($400,000) ($220,000)
Fiscal Analysis
The bill would amend Chapter 151 of the Tax Code, to provide for an exemption from sales tax of a firearm or hunting supplies if the sale takes place either 1) beginning with the Saturday of the last full weekend in August and ending with the following Sunday, or 2) beginning on the Saturday of the last full weekend in October and ending with the following Sunday. The term "hunting supplies" would include ammunition, archery equipment, hunting blinds and stands, hunting decoys, firearm cleaning supplies, gun cases, gun safes, hunting optics, and hunting safety equipment. In the event the bill fails to take immediate effect, there is provision for a tax exemption period during the first weekend in September rather than the last weekend in August in 2015. The bill would take effect immediately upon enactment, assuming it received the requisite two-thirds majority votes in both houses of the Legislature. Otherwise, it would take effect September 1, 2015.
Methodology
National and regional data on annual firearm and hunting supplies sales from an annual report issued by the National Sporting Goods Association was apportioned to the state based on population, adjusted for the portion that would likely occur during the exemption periods, multiplied by the state sales tax rate, and extrapolated through 2020.To the extent spending on other items, including hunting licenses, is induced by this sales tax holiday, there may be some offsetting increase in revenue. This amount, however, cannot be estimated.
Local Government Impact
There would be a proportional loss of sales and use tax revenue from local taxing jurisdictions.
Source Agencies: 304 Comptroller of Public Accounts
304 Comptroller of Public Accounts
LBB Staff: UP, KK, SD
UP, KK, SD