LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE, 88TH LEGISLATIVE REGULAR SESSION April 23, 2023 TO: Honorable Morgan Meyer, Chair, House Committee on Ways & Means FROM: Jerry McGinty, Director, Legislative Budget Board IN RE: HB5070 by Button (Relating to the exclusion of services provided by a marketplace provider from the definition of data processing services.), As Introduced Estimated Two-year Net Impact to General Revenue Related Funds for HB5070, As Introduced : a negative impact of ($47,700,000) 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($20,830,000)2025($26,870,000)2026($28,920,000)2027($31,140,000)2028($33,380,000)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($20,830,000)($3,820,000)($1,270,000)($870,000)2025($26,870,000)($4,930,000)($1,640,000)($1,120,000)2026($28,920,000)($5,310,000)($1,760,000)($1,200,000)2027($31,140,000)($5,710,000)($1,900,000)($1,300,000)2028($33,380,000)($6,130,000)($2,030,000)($1,390,000) Fiscal AnalysisThe bill would amend Section 151.0035 of the Tax Code to exclude services provided by marketplace providers in relation to processing a sale or payment for a marketplace seller from the definition of a data processing service.The bill would take effect October 1, 2023, and would only apply to tax liabilities after that date.
LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 88TH LEGISLATIVE REGULAR SESSION
April 23, 2023
TO: Honorable Morgan Meyer, Chair, House Committee on Ways & Means FROM: Jerry McGinty, Director, Legislative Budget Board IN RE: HB5070 by Button (Relating to the exclusion of services provided by a marketplace provider from the definition of data processing services.), As Introduced
TO: Honorable Morgan Meyer, Chair, House Committee on Ways & Means
FROM: Jerry McGinty, Director, Legislative Budget Board
IN RE: HB5070 by Button (Relating to the exclusion of services provided by a marketplace provider from the definition of data processing services.), 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
HB5070 by Button (Relating to the exclusion of services provided by a marketplace provider from the definition of data processing services.), As Introduced
HB5070 by Button (Relating to the exclusion of services provided by a marketplace provider from the definition of data processing services.), As Introduced
Estimated Two-year Net Impact to General Revenue Related Funds for HB5070, As Introduced : a negative impact of ($47,700,000) through the biennium ending August 31, 2025.
Estimated Two-year Net Impact to General Revenue Related Funds for HB5070, As Introduced : a negative impact of ($47,700,000) through the biennium ending August 31, 2025.
General Revenue-Related Funds, Five- Year Impact:
2024 ($20,830,000)
2025 ($26,870,000)
2026 ($28,920,000)
2027 ($31,140,000)
2028 ($33,380,000)
All Funds, Five-Year Impact:
2024 ($20,830,000) ($3,820,000) ($1,270,000) ($870,000)
2025 ($26,870,000) ($4,930,000) ($1,640,000) ($1,120,000)
2026 ($28,920,000) ($5,310,000) ($1,760,000) ($1,200,000)
2027 ($31,140,000) ($5,710,000) ($1,900,000) ($1,300,000)
2028 ($33,380,000) ($6,130,000) ($2,030,000) ($1,390,000)
Fiscal Analysis
The bill would amend Section 151.0035 of the Tax Code to exclude services provided by marketplace providers in relation to processing a sale or payment for a marketplace seller from the definition of a data processing service.The bill would take effect October 1, 2023, and would only apply to tax liabilities after that date.
Methodology
Data on the various fees charged by marketplace providers, total sales made on marketplace platforms, and sales tax remitted by marketplace providers was used to estimate the amount of taxable data processing services that are currently performed by marketplace providers on behalf of marketplace sellers located in Texas.
Local Government Impact
Fiscal implications for units of local government were estimated proportionally.
Source Agencies: b > td > 304 Comptroller of Public Accounts
304 Comptroller of Public Accounts
LBB Staff: b > td > JMc, KK, SD
JMc, KK, SD