Texas 2017 - 85th Regular

Texas Senate Bill SB112 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	85R920 BEF-D
2	2	By: Huffines S.B. No. 112
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to the decrease of the rates of the franchise tax under
8	8	certain circumstances and the expiration of that tax.
9	9	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
10	10	SECTION 1. Sections 171.002(a) and (b), Tax Code, are
11	11	amended to read as follows:
12	12	(a) Subject to Sections 171.003, 171.004, and 171.1016 and
13	13	except as provided by Subsection (b), the rate of the franchise tax
14	14	is 0.75 percent of taxable margin.
15	15	(b) Subject to Sections 171.003, 171.004, and 171.1016, the
16	16	rate of the franchise tax is 0.375 percent of taxable margin for
17	17	those taxable entities primarily engaged in retail or wholesale
18	18	trade.
19	19	SECTION 2. Subchapter A, Chapter 171, Tax Code, is amended
20	20	by adding Section 171.004 to read as follows:
21	21	Sec. 171.004. ADJUSTMENT OF TAX RATES. (a) In this
22	22	section, "maximum general revenue fund appropriations" means for a
23	23	state fiscal biennium the sum of:
24	24	(1) the maximum amount of state tax revenues not
25	25	dedicated by the constitution that may be appropriated under
26	26	Sections 22(a) and (c), Article VIII, Texas Constitution, for that
27	27	biennium; and
28	28	(2) the estimated amount of anticipated revenue to be
29	29	deposited to the credit of the general revenue fund during that
30	30	biennium that is not subject to the limit on appropriations under
31	31	Section 22(a), Article VIII, Texas Constitution, as specified in
32	32	the estimate prepared by the comptroller as required by Section
33	33	49a(a), Article III, Texas Constitution.
34	34	(b) Beginning in 2020, on January 1 of each year if the
35	35	comptroller determines that the maximum general revenue fund
36	36	appropriations for the state fiscal biennium during which that date
37	37	occurs is at least $110 billion:
38	38	(1) the rate of the franchise tax under Section
39	39	171.002(a) is adjusted by subtracting 0.15 from the rate in effect
40	40	on December 31 of the previous year; and
41	41	(2) the rate of the franchise tax under Section
42	42	171.002(b) is adjusted by subtracting 0.075 from the rate in effect
43	43	on December 31 of the previous year.
44	44	(c) The tax rates determined under Subsection (b):
45	45	(1) apply to a report originally due on or after the
46	46	date the determination is made; and
47	47	(2) are considered for purposes of this chapter to be
48	48	the rates provided by and imposed under Section 171.002.
49	49	(d) Notwithstanding Subsection (b), if an adjustment
50	50	otherwise required by Subsection (b) would reduce a rate of the
51	51	franchise tax to less than zero, the rate is instead reduced to
52	52	zero.
53	53	(e) Notwithstanding any other law, if the rates of the
54	54	franchise tax are reduced to zero under Subsection (b) or (d), a
55	55	taxable entity does not owe any tax and is not required to file a
56	56	report that would otherwise be originally due on or after the date
57	57	the rates are reduced to zero.
58	58	(f) The comptroller shall make the determination required
59	59	by Subsection (b) and may adopt rules related to making that
60	60	determination. The comptroller shall publish the franchise tax
61	61	rates determined under this section in the Texas Register and on the
62	62	comptroller's Internet website not later than January 15 of each
63	63	year.
64	64	(g) In the state fiscal year in which the rates of the
65	65	franchise tax are reduced to zero under Subsection (b) or (d):
66	66	(1) this chapter expires as provided by Section
67	67	171.9121; and
68	68	(2) not later than January 15 of that year the
69	69	comptroller shall:
70	70	(A) publish notice in the Texas Register that an
71	71	entity previously subject to the tax imposed under this chapter is
72	72	no longer required to file a report or pay the tax; and
73	73	(B) provide any other notice relating to the
74	74	expiration of the tax that the comptroller considers appropriate.
75	75	(h) An action taken by the comptroller under this section is
76	76	final and may not be appealed.
77	77	SECTION 3. Chapter 171, Tax Code, is amended by adding
78	78	Subchapter Z to read as follows:
79	79	SUBCHAPTER Z. EXPIRATION
80	80	Sec. 171.9121. EXPIRATION. This chapter expires on
81	81	December 31 of the year in which the rates of the franchise tax are
82	82	reduced to zero under Section 171.004(b) or (d).
83	83	SECTION 4. (a) Chapter 171, Tax Code, and Subtitle B,
84	84	Title 2, Tax Code, continue to apply to audits, deficiencies,
85	85	redeterminations, and refunds of any tax due or collected under
86	86	Chapter 171 until barred by limitations.
87	87	(b) The expiration of Chapter 171, Tax Code, does not
88	88	affect:
89	89	(1) the status of a taxable entity that has had its
90	90	corporate privileges, certificate of authority, certificate of
91	91	organization, certificate of limited partnership, corporate
92	92	charter, or registration revoked, a suit filed against it, or a
93	93	receiver appointed under Subchapter F, G, or H of that chapter;
94	94	(2) the ability of the comptroller of public accounts,
95	95	secretary of state, or attorney general to take action against a
96	96	taxable entity under Subchapter F, G, or H of that chapter for
97	97	actions that took place before the chapter expired; or
98	98	(3) the right of a taxable entity to contest a
99	99	forfeiture, revocation, lawsuit, or appointment of a receiver under
100	100	Subchapter F, G, or H of that chapter.
101	101	SECTION 5. This Act applies only to a report originally due
102	102	on or after January 1, 2020.
103	103	SECTION 6. This Act takes effect January 1, 2018.