Relating to an exemption from sales and use taxes for certain tangible personal property used in hydraulic fracturing.

89(R) HB 4382 - Introduced version - Bill Text

89R9680 JBD-F

By: Darby

H.B. No. 4382

A BILL TO BE ENTITLED

AN ACT

relating to an exemption from sales and use taxes for certain

tangible personal property used in hydraulic fracturing.

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

SECTION 1. Section 151.355, Tax Code, is amended to read as

follows:

Sec. 151.355. WATER-RELATED EXEMPTIONS.
(a)
The following

are exempted from taxes imposed by this chapter:

(1) rainwater harvesting equipment or supplies, water

recycling and reuse equipment or supplies, or other equipment,

services, or supplies used solely to reduce or eliminate water use;

(2) equipment, services, or supplies used solely for

desalination of surface water or groundwater;

(3) equipment, services, or supplies used solely for

brush control designed to enhance the availability of water;

(4) equipment, services, or supplies used solely for

precipitation enhancement;

(5) equipment, services, or supplies used solely to

construct or operate a water or wastewater system certified by the

Texas Commission on Environmental Quality as a regional system;

(6) equipment, services, or supplies used solely to

construct or operate a water supply or wastewater system by a

private entity as a public-private partnership as certified by the

political subdivision that is a party to the project; and

(7) tangible personal property specifically used to

process, reuse, or recycle
water, other than freshwater,

[
wastewater
] that will be used in fracturing work performed at an

oil or gas well.

(b)

For the purposes of this section, "freshwater"

means

water containing less than 1,000 milligrams per liter of total

dissolved solids.

SECTION 2. Section 151.355, Tax Code, as amended 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 3. This Act takes effect September 1, 2025.