Part 1.
COMPTROLLER OF PUBLIC ACCOUNTS
Chapter 3.
TAX ADMINISTRATION
Subchapter P. MUNICIPAL SALES AND USE TAX
34 TAC §3.378
The Comptroller of Public Accounts adopts an amendment to §3.378
concerning natural gas and electricity, with changes to the proposed text
as published in the February 25, 2000, issue of the
Texas Register
(25 TexReg 1564).
The amendment reflects changes to the Tax Code, §151.317, enacted
by the 76th Legislature, 1999, making nonsubstantive revisions and codifying
the agency's long-standing policy of using predominant use to determine the
taxability of natural gas or electricity measured through a single meter when
used for exempt or taxable purposes. References to the 1.0% local tax rate
were deleted because since 1987, certain cities have imposed the 1/2% additional
sales and use tax for property tax relief and others have imposed development
corporation sales and use tax in 1/8% increments up to 1/2%. The procedures
for cities to reimpose sales tax on residential use of natural gas and electricity
are amended to clarify the statutory requirements a qualifying city had to
fulfill before the city could continue taxation or reimpose the tax.
Changes were made to subsection (b)(2)(C) of the proposed rule. In that
subparagraph, the verb "wishes" has been changed to past tense to indicate
that the actions described are no longer available. Governing bodies of cities
that wished to continue the taxation of residential use of natural gas and
electricity had to take specific actions on specific dates in 1979. Any city
that did not meet the requirements specified at that time cannot currently
tax residential use of natural gas and electricity.
Changes were also made to subsection (b)(2)(F) of the proposed rule to
remove obsolete language regarding the deadline for cities to adopt the option
to tax residential use of natural gas and electricity. Cities adopting the
local sales and use tax after October 1, 1979, cannot tax residential use
of natural gas and electricity.
No comments were received regarding adoption of the amendment.
This amendment is adopted under the Tax Code, §111.002,
which provides the comptroller with the authority to prescribe, adopt, and
enforce rules relating to the administration and enforcement of the provisions
of the Tax Code, Title 2.
The amendment implements the Tax Code, §151.317.
§3.378.Natural Gas and Electricity.
(a)
Natural gas and electricity: imposition of the tax.
(1)
The local tax applies to sales of natural gas and electricity
for use in a city that has adopted the local tax and must be collected for
the city in which delivery is made to the consumer.
(2)
When a city adopts the local tax, the tax does not apply
to sales of natural gas and electricity during a customer's regular monthly
billing period that begins before the effective date of the adoption of the
tax. The tax shall apply to each regular monthly billing period beginning
on or after the effective date of the tax.
(b)
Natural gas and electricity: exemptions from tax.
(1)
Certain uses of natural gas and electricity are exempt
from local tax. See §3.295 of this title (relating to Natural Gas and
Electricity) for a discussion of definitions, specific exemptions relating
to the sale or use of natural gas and electricity, and the circumstances under
which the predominant use theory may be applied. Residential use of natural
gas and electricity in a city is exempt unless the tax is imposed by a city
as provided in paragraph (2) of this subsection.
(2)
Residential use of natural gas and electricity.
(A)
Effective October 1, 1979, the sale of natural gas and
electricity for residential use is exempt from taxation under the Local Sales
and Use Tax Act unless:
(i)
the city voted for early abolition (see subparagraph (B)
of this paragraph);
(ii)
the city voted to continue taxation (see subparagraph
(C) of this paragraph); or
(iii)
the city voted to reimpose tax (see subparagraph (D)
of this paragraph).
(B)
Early abolition. At any time before October 1, 1979, by
a majority vote of the membership of the governing body of a city, the governing
body could exempt from the local tax the sale of natural gas and electricity
for residential use. After the results of the vote were entered into the minutes
of the city, the city secretary must have forwarded to the comptroller by
registered or certified mail a certified copy of the ordinance. On receipt
of notification, one whole calendar quarter must have elapsed prior to the
exemption becoming effective (see §3.372(d)(1) of this title (relating
to Adoption or Abolition City Tax) for an illustration of this procedure)
unless notification was received by the comptroller by registered or certified
mail postmarked no later than September 10, 1978; in which case, the exemption
was effective on October 1, 1978.
(C)
Continue taxation. If the governing body of a city wished
to continue to impose the local tax on the sale of natural gas and electricity
for residential use, the city secretary must have forwarded to the comptroller's
office before May 1, 1979, by registered or certified mail a certified copy
of the ordinance reflecting the majority vote of the membership exempting
natural gas and electricity. If the ordinance was not received by the comptroller
before May 1, 1979, the exemption from the local tax automatically became
effective on October 1, 1979. To continue the taxation of residential use,
the city secretary must have forwarded to the comptroller's office before
June 30, 1979, by registered or certified mail, a certified copy of the ordinance
reflecting the majority vote of the membership reimposing tax on natural gas
and electricity.
(D)
Reimposition of tax authorized. The local tax may be reimposed
by a majority vote of the membership of the governing body of a city that
exempted residential use of natural gas and electricity before May 1, 1979.
If the majority of the governing body votes for the reimposition of the local
tax, the results of the vote must be entered in the minutes of the city. Thereafter,
the city secretary must forward to the comptroller by registered or certified
mail a certified copy of the ordinance reimposing the tax. Upon receipt of
notification by the comptroller, there shall elapse one whole calendar quarter
prior to the reimposition becoming effective. The reimposition shall take
effect beginning on the first day of the calendar quarter next succeeding
the elapsed quarter.
(E)
Effect of billing periods. The exemption or reimposition
of the local tax does not apply to sales of natural gas and electricity for
residential use made during a customer's regular monthly billing period which
begins before the effective date of the exemption or reimposition. The exemption
or reimposition shall apply to each regular monthly billing period beginning
on or after the effective date of the exemption or reimposition.
(F)
Cities adopting the Local Sales and Use Tax Act. Cities
that first adopt the local sales and use tax after October 1, 1979, may not
impose the tax on the residential use of natural gas and electricity.
(G)
The sale of natural gas and electricity for residential
use is automatically exempt from the additional city tax imposed under the
Tax Code, §321.101(b) or the Development Corporation Act of 1979 (Texas
Civil Statutes, Art. 5190.6), if the sale of natural gas and electricity is
exempt from tax under §321.101(a). The sale of natural gas and electricity
for residential use is automatically taxed under Tax Code, §321.101(b)
if the tax under Tax Code, §321.101(a) is imposed on the sale of natural
gas and electricity for residential use.
This agency hereby certifies that the adoption
has been reviewed by legal counsel and found to be a valid exercise of the
agency's legal authority.
Filed with the Office of
the Secretary of State on July 26, 2000.
TRD-200005186
Martin Cherry
Deputy General Counsel for Tax Policy and Agency Affairs
Comptroller of Public Accounts
Effective date: August 15, 2000
Proposal publication date: February 25, 2000
For further information, please call: (512) 463-3699
Subchapter A. PRACTICE AND PROCEDURE
34 TAC §9.17
The Comptroller of Public Accounts adopts an amendment to §9.17,
concerning notice of public hearing on tax increase, without changes to the
proposed text as published in the June 16, 2000, issue of the
Texas Register
(25 TexReg 5850).
This section is being amended to provide for changes to the model form
for notice of public hearing on tax increase from House Bill 954, 76th Legislature,
1999, effective January 1, 2000, and to change the form number to conform
with the comptroller form numbering system.
No comments were received regarding adoption of the amendment.
This amendment is adopted under the Tax Code, §26.06(g),
which requires the comptroller to adopt rules prescribing the language and
format to be used in the part of the notice required by Tax Code, §26.06(b)(2).
The amendment implements the Tax Code, §26.06.
This agency hereby certifies that the adoption has been reviewed
by legal counsel and found to be a valid exercise of the agency's legal authority.
Filed with the Office of
the Secretary of State on July 25, 2000.
TRD-200005105
Martin Cherry
Deputy General Counsel for Tax Policy and Agency Affairs
Comptroller of Public Accounts
Effective date: August 14, 2000
Proposal publication date: June 16, 2000
For further information, please call: (512) 463-3699
34 TAC §9.18
The Comptroller of Public Accounts adopts a new §9.18,
concerning adjustment for optional homestead exemption, without changes to
the proposed text as published in the June 16, 2000, issue of the
Texas Register
(25 TexReg 5850).
This rule is being adopted to reflect statutory changes made by Senate
Bill 4, 76th Legislature, 1999, effective September 1, 1999.
No comments were received regarding adoption of the new rule.
This new section is adopted under the Tax Code, §111.002
and §111.0022, which provides the comptroller the authority to adopt
rules for the administration and enforcement of the Tax Code and programs
or functions assigned to the comptroller by law.
The new section implements the Tax Code, §26.08, and the Education
Code, §42.2522(e).
This agency hereby certifies that the adoption has been reviewed
by legal counsel and found to be a valid exercise of the agency's legal authority.
Filed with the Office of
the Secretary of State on July 25, 2000.
TRD-200005104
Martin Cherry
Deputy General Counsel for Tax Policy and Agency Affairs
Comptroller of Public Accounts
Effective date: August 14, 2000
Proposal publication date: June 16, 2000
For further information, please call: (512) 463-3699
Chapter 41.
INSURANCE PROGRAMS
Subchapter A. HEALTH CARE BENEFITS
Chapter 9.
PROPERTY TAX ADMINISTRATION
Part 3.
TEACHER RETIREMENT SYSTEM OF TEXAS