89R8403 SRA-F
By: Capriglione H.B. No. 3684
A BILL TO BE ENTITLED
AN ACT
relating to the exclusion of certain securities transaction
payments from the total revenue of a taxable entity that is an
exchange or a member of an exchange for purposes of the franchise
tax.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 171.0001(13-a), Tax Code, is amended to
read as follows:
(13-a) "Security," for purposes of Sections
171.1011(g), 171.1011(g-2), 171.1011(y), 171.1011(z), and
171.106(f) only, has the meaning assigned by Section 475(c)(2),
Internal Revenue Code, and includes instruments described by
Sections 475(e)(2)(B), (C), and (D) of that code.
SECTION 2. Section 171.1011, Tax Code, is amended by adding
Subsections (y) and (z) to read as follows:
(y) A taxable entity shall exclude from its total revenue:
(1) if the entity is an exchange, transaction rebate
payments made by the exchange to a member of the exchange as part of
a securities transaction; and
(2) if the entity is a member of an exchange,
transaction rebate payments made to the member by the exchange as
part of a securities transaction.
(z) For purposes of Subsection (y):
(1) "Exchange" has the meaning assigned by 15 U.S.C.
Section 78C(a)(1).
(2) "Member" has the meaning assigned by 15 U.S.C.
Section 78C(a)(3)(A).
(3) "Securities transaction" means the purchase or
sale of a security on an exchange by a member of the exchange.
(4) "Transaction rebate payment" means an amount paid
to compensate a member of the exchange in order to provide liquidity
to the market.
SECTION 3. This Act applies only to a report originally due
on or after the effective date of this Act.
SECTION 4. This Act takes effect January 1, 2026.