The fiscal matters bill, SB 1 by Sen. Robert Duncan (R-Lubbock), which was essential to the balanced budget and passed the legislature during the special session, included several tax provisions. The following franchise tax changes are in the bill:
- Extension of the $1 million minimum revenue threshold for two years until Dec. 31, 2013 (Article 37)
- Extension of the deadline to use pre-margin tax credits until Dec. 31, 2016 (Article 31)
- Excluding payments to live entertainers from total revenue when made by live entertainment companies as defined in the bill (Article 44)
- Excluding payments to non-employee delivery contractors from total revenue by qualified logistics companies as defined in the bill (Article 44)
- Adding apparel rental entities as retailers if classified in SIC Codes 5999 and 7299 (Article 51)
SB 1 also includes the enactment of the full text of HB 2403 by CPA Rep. John Otto. HB 2403, the so-called Amazon bill, which requires retailers with any operations in Texas, even through affiliates, to collect Texas sales taxes was vetoed by Perry during the regular session. For the second time the legislature has passed this legislation to require more Internet retailers to collect Texas sales taxes. To kill the legislation this time, the governor would have to veto SB 1 which would unravel the state’s balanced budget.
Other sections of SB 1 that might be of interest to some taxpayers include:
- The annual August sales tax holiday weekend timing is changed to be “the Friday before the eighth day preceding the earliest date on which any school district may begin instruction…”
- New requirements for maintaining certain tax records for certain taxpayers (Article 4)
- New required prepayments of certain motor fuels taxes (Article 9)
- New required prepayments of certain alcoholic beverage taxes and fees (Article 10)
- A reduction in the cigarette tax stamping allowance (Article 11)
- Prepayment requirement for certain sales and use taxes (Article 13)
- Adding a $50 failure to file penalty in addition to other penalties for certain tax forms (Article 14)
CPAs and attorneys might find it interesting that SB 1 also provides that any attorneys employed by the attorney general are to be given full continuing legal education credit by the State Bar Association. The bill does require the AG to train them.
The bill is 263 pages with numerous changes to tax collections and fiscal operations of the state.
If you’d like a brief rundown of the special session bills and what happened with each, check out the Texas Tribune’s Sine Die Report: What Survived, What Died.