HBA-JLV C.S.H.B. 2582 77(R)BILL ANALYSIS


Office of House Bill AnalysisC.S.H.B. 2582
By: Chavez
Ways & Means
4/30/2001
Committee Report (Substituted)



BACKGROUND AND PURPOSE 

The United States Constitution exempts exports from state taxation and the
State of Texas has enacted statutes recognizing the exemption and provides
a means for obtaining a refund of state sales tax paid on exports.  One of
those means is by a licensed customs broker issuing documentation
certifying that merchandise is an export.  The statutes under which this
documentation is issued do not provide sufficient direction regarding when
and under what procedures this documentation may be issued certifying
merchandise  as an export.  Correcting these deficiencies could help ensure
the state's proper collection of taxes and benefit the economy of the state
by encouraging the sale of exports from Texas to Mexico. C.S.H.B. 2582
establishes procedures under which licensed customs brokers operate,
including procedures under which they may issue documentation certifying
merchandise as an export, and provides for fines and penalties to be
imposed when procedures are not followed.   

RULEMAKING AUTHORITY

It is the opinion of the Office of House Bill Analysis that rulemaking
authority is expressly delegated to the comptroller of public accounts in
SECTION 1.02 (Section 151.1575, Tax Code) of this bill. 

ANALYSIS

C.S.H.B. 2582 amends the Tax Code to establish procedures under which
licensed custom brokers (broker) operate.  The bill increases, from $500 to
$5,000, the amount of the bond or security a broker is required to post for
the comptroller of public accounts (comptroller) to issue a license to a
broker.  The comptroller is prohibited from requiring a bond or security in
an amount greater than $10,000, rather than $2,500.  The bill authorizes
the comptroller to suspend or revoke a license if the broker does not
comply with certain provisions or knowingly or intentionally issues
documentation that is false to obtain a refund of taxes paid on tangible
personal property not exported or to assist another person in obtaining
such a refund. 

The bill sets forth provisions regarding the requirements which authorize a
broker licensed by the comptroller or an authorized employee of the broker
to issue documentation certifying that delivery of tangible personal
property was made to a point outside the territorial limits of the United
States.  The bill authorizes the broker or authorized employee of the
broker to issue and deliver documentation at any time after the tangible
personal property is purchased and the broker or employee completes the
certification process.  The bill sets forth the information the
documentation must include.  The comptroller may require a broker to pay
the comptroller the amount of any tax refund if the customs broker does not
comply with applicable provisions and rules adopted by the comptroller.
The bill authorizes the comptroller to require the broker to pay a penalty
in an amount equal to two times the amount of the refunded tax, but not
less than $500 nor more than $5,000.  The bill provides that a proceeding
to require a broker to pay a penalty is a contested case in the same manner
as a proceeding to revoke or suspend a broker's license.  The above
provisions expire on September 1, 2003, after which the law as it
previously existed before the enactment of these provisions takes effect. 

 The bill  increases, from an amount not to exceed five cents to an amount
of fifty cents, that the comptroller  is required to charge for each stamp.
The bill requires that one-third of any surplus revenue from the sale of
stamps to be allocated for the enforcement of provisions relating to a
customs broker and requires that two-thirds of any surplus revenue from the
sale of stamps to be allocated to the Texas Department of Transportation
for expenses related to transportation infrastructure maintenance and
improvement.  The bill provides that such revenue shall be expended
proportionally in the districts from which the stamp fee is raised.  

EFFECTIVE DATE

September 1, 2001.

COMPARISON OF ORIGINAL TO SUBSTITUTE

C.S.H.B. 2582 modifies the original to provide that certain provisions
expire on September 1, 2003, after which the law as it previously existed
before the enactment of these provisions takes effect.  The substitute
increases the amount the comptroller of public accounts is required to
charge for each stamp.  The substitute sets forth provisions relating to
the distribution of any surplus revenue from the sale of stamps and
provides that such revenue shall be expended proportionally in the
districts from which the stamp fee is raised.