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Summary: HB 1310 would allow a physician practice to exclude the cost of vaccines used in “pro bono,” health care work from the calculation of their margin tax payment. The LBB estimates HB 1310 would result in a revenue loss to the Property Tax Relief Fund of $3,713,000 for the 2014-15 biennium. Any loss to the Property Tax Relief Fund must be made up with an equal amount of General Revenue to fund the Foundation School Program.
Analysis: HB 1310 would codify another exemption to the Franchise Tax, making the tax even more unfair and complicated. While encouraging doctors to provide pro bono health care services is admirable, the Franchise Tax code is not the place to do it because it effects all other taxpayers and it treats unequally every other business that must deal with the Franchise Tax in full. Instead of empowering government to pick winners and losers in the tax code, which expands the power of government, legislators should contemplate tax policy that is broad based, low rate, and equitable for all Texans.
However, encouraging pro bono work in this way could relieve pressure on indigent care and Medicaid.
We encourage legislators to oppose HB 1310.