LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE, 88TH LEGISLATIVE REGULAR SESSION April 30, 2023 TO: Honorable Morgan Meyer, Chair, House Committee on Ways & Means FROM: Jerry McGinty, Director, Legislative Budget Board IN RE: HB3003 by Bailes (Relating to the sales and use tax exemption for the repair, remodeling, or maintenance of aircraft.), As Introduced Estimated Two-year Net Impact to General Revenue Related Funds for HB3003, As Introduced : a negative impact of ($82,390,000) through the biennium ending August 31, 2025. General Revenue-Related Funds, Five- Year Impact: Fiscal Year Probable Net Positive/(Negative) Impact toGeneral Revenue Related Funds2024($38,674,000)2025($43,716,000)2026($45,609,000)2027($47,652,000)2028($49,848,000)All Funds, Five-Year Impact: Fiscal Year Probable Revenue (Loss) fromGeneral Revenue Fund1 Probable Revenue (Loss) fromCities Probable Revenue (Loss) fromTransit Authorities Probable Revenue (Loss) fromCounties & Special Districts2024($38,674,000)($7,100,000)($2,360,000)($1,610,000)2025($43,716,000)($8,020,000)($2,660,000)($1,820,000)2026($45,609,000)($8,370,000)($2,780,000)($1,900,000)2027($47,652,000)($8,740,000)($2,900,000)($1,980,000)2028($49,848,000)($9,150,000)($3,040,000)($2,070,000) Fiscal AnalysisThe bill would amend Section 151.328 of the Tax Code, relating to sales and use taxation of aircraft.The bill would amend Subsection (b) to provide that repair, remodeling, and maintenance services to all aircraft are exempt. Current law limits this exemption to services performed with respect to aircraft used as certified or licensed carriers of persons or property, used for flight instruction, or used for certain agricultural purposes.The bill would amend Subsections (d) and (e) to provide that machinery, tools, supplies, and equipment used exclusively in the repair, remodeling, or maintenance of all aircraft are exempt, as well as tangible personal property affixed, attached, or placed in all aircraft. Current law limits these exemptions to aircraft used as certified or licensed carriers of persons or property or used for flight instruction.The bill would take effect September 1, 2023.
LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 88TH LEGISLATIVE REGULAR SESSION
April 30, 2023
TO: Honorable Morgan Meyer, Chair, House Committee on Ways & Means FROM: Jerry McGinty, Director, Legislative Budget Board IN RE: HB3003 by Bailes (Relating to the sales and use tax exemption for the repair, remodeling, or maintenance of aircraft.), As Introduced
TO: Honorable Morgan Meyer, Chair, House Committee on Ways & Means
FROM: Jerry McGinty, Director, Legislative Budget Board
IN RE: HB3003 by Bailes (Relating to the sales and use tax exemption for the repair, remodeling, or maintenance of aircraft.), As Introduced
Honorable Morgan Meyer, Chair, House Committee on Ways & Means
Honorable Morgan Meyer, Chair, House Committee on Ways & Means
Jerry McGinty, Director, Legislative Budget Board
Jerry McGinty, Director, Legislative Budget Board
HB3003 by Bailes (Relating to the sales and use tax exemption for the repair, remodeling, or maintenance of aircraft.), As Introduced
HB3003 by Bailes (Relating to the sales and use tax exemption for the repair, remodeling, or maintenance of aircraft.), As Introduced
Estimated Two-year Net Impact to General Revenue Related Funds for HB3003, As Introduced : a negative impact of ($82,390,000) through the biennium ending August 31, 2025.
Estimated Two-year Net Impact to General Revenue Related Funds for HB3003, As Introduced : a negative impact of ($82,390,000) through the biennium ending August 31, 2025.
General Revenue-Related Funds, Five- Year Impact:
2024 ($38,674,000)
2025 ($43,716,000)
2026 ($45,609,000)
2027 ($47,652,000)
2028 ($49,848,000)
All Funds, Five-Year Impact:
2024 ($38,674,000) ($7,100,000) ($2,360,000) ($1,610,000)
2025 ($43,716,000) ($8,020,000) ($2,660,000) ($1,820,000)
2026 ($45,609,000) ($8,370,000) ($2,780,000) ($1,900,000)
2027 ($47,652,000) ($8,740,000) ($2,900,000) ($1,980,000)
2028 ($49,848,000) ($9,150,000) ($3,040,000) ($2,070,000)
Fiscal Analysis
The bill would amend Section 151.328 of the Tax Code, relating to sales and use taxation of aircraft.The bill would amend Subsection (b) to provide that repair, remodeling, and maintenance services to all aircraft are exempt. Current law limits this exemption to services performed with respect to aircraft used as certified or licensed carriers of persons or property, used for flight instruction, or used for certain agricultural purposes.The bill would amend Subsections (d) and (e) to provide that machinery, tools, supplies, and equipment used exclusively in the repair, remodeling, or maintenance of all aircraft are exempt, as well as tangible personal property affixed, attached, or placed in all aircraft. Current law limits these exemptions to aircraft used as certified or licensed carriers of persons or property or used for flight instruction.The bill would take effect September 1, 2023.
Methodology
The fiscal implications were estimated based on data from Comptroller tax files on amounts subject to Texas sales and use tax of businesses performing aircraft repair and maintenance.
Local Government Impact
There would be a corresponding loss of sales and use tax revenue from local taxing jurisdictions.
Source Agencies: b > td > 304 Comptroller of Public Accounts
304 Comptroller of Public Accounts
LBB Staff: b > td > JMc, KK, SD
JMc, KK, SD