Relating to sales and use tax rates and refunds for certain tangible personal property used to provide cable television services, Internet access services, or telecommunications services; reducing the rate of the state sales and use tax applicable to certain taxable items.

89(R) HB 2825 - House Committee Report version - Bill Text

89R29136 CJD-D

By: Craddick, Martinez

H.B. No. 2825

Substitute the following for H.B. No. 2825:

By: Bernal

C.S.H.B. No. 2825

A BILL TO BE ENTITLED

AN ACT

relating to sales and use tax rates and refunds for certain tangible

personal property used to provide cable television services,

Internet access services, or telecommunications services; reducing

the rate of the state sales and use tax applicable to certain

taxable items.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Effective January 1, 2028, Subchapter H, Chapter

151, Tax Code, is amended by adding Section 151.3187 to read as

follows:

Sec.

151.3187.

PROPERTY USED IN CABLE TELEVISION, INTERNET

ACCESS, OR TELECOMMUNICATIONS SERVICES.

(a)

In this section,

"provider" means a provider of cable television service, Internet

access service, or telecommunications services.

(b)

Notwithstanding Sections 151.051 and 151.101 and except

as provided by Subsection (c), the rate of the tax imposed under

this chapter on the sale, lease, or rental or storage, use, or other

consumption of tangible personal property is four percent if:

(1)

the property is sold, leased, or rented to or

stored, used, or consumed by a provider or a subsidiary of a

provider; and

(2)

the property is directly used or consumed by the

provider or subsidiary described by Subdivision (1) in or during:

(A)

the distribution of cable television

service;

(B) the provision of Internet access service; or

(C)

the transmission, conveyance, routing, or

reception of telecommunications services.

(c) This section does not apply to:

(1)

the sale, lease, or rental or storage, use, or

other consumption of tangible personal property directly used or

consumed in or during the provision, creation, or production of a

data processing service or information service; or

(2)

a tax authorized or imposed under Subtitle C,

Title 3.

(d)

The comptroller shall adopt rules to implement this

section, including rules providing for a partial refund of any

amount of tax imposed at the rate provided by Subsection (b) but

collected at the rate provided by Section 151.051(b).

SECTION 2. Section 151.3186, Tax Code, is repealed.

SECTION 3. (a) The repeal of Section 151.3186, Tax Code, by

this Act does not affect a refund:

(1) to which a taxpayer became entitled before the

effective date of this Act; and

(2) for which a taxpayer timely filed a claim with the

comptroller of public accounts on or before March 31, 2027.

(b) Except as provided by Subsection (a) of this section,

the change in law made by this Act does not affect tax liability

accruing before the effective date of this Act. That liability

continues in effect as if this Act had not been enacted, and the

former law is continued in effect for the collection of taxes due

and for civil and criminal enforcement of the liability for those

taxes.

SECTION 4. Except as otherwise provided by this Act, this

Act takes effect January 1, 2027.