Bill

HB 2507

84(R) - 2015
House Ways & Means
Read Bill & Check Bill Status
House Ways & Means
Taxes

Vote Recommendation

No
  • Negative
  • Neutral
  • Neutral
  • Negative
  • Neutral

Author(s)

Kyle Kacal

Co-Author(s)

John Raney
Drew Springer

Bill Caption

Relating to a sales and use tax exemption for certain equipment used for digital audio broadcasting.

Fiscal Notes

A fiscal note dated April 20, 2015 anticipates a negative two-year net impact to General Revenue Related Funds for CSHB 2507 of $140,000 through the biennium ending August 31, 2017.

There would be a proportional loss of sales and use tax revenue from local taxing jurisdictions as shown in the above table. 

Bill Analysis

House Bill 2507 would amend Section 151.3185 of the Tax Code related to exemptions from the sales and use tax for property used in the production of motion pictures or video or audio recordings and broadcasts.

It would add an exemption from the sales and use tax for tangible personal property that is sold to an entity to which 47 C.F.R. Section 73.404(a) (related to licensed digital audio broadcasting stations that use the In-band On-channel system for broadcasting purposes) applies if the property is necessary to provide the broadcast service described by 47 C.F.R. Section 73.403 or 73.404.

The second chamber sponsor is Senator Kel Seliger.

Vote Recommendation Notes

5/18/15 Update:

No amendments or modifications have been made to the bill since we reported on it. We continue to oppose it.

First chamber analysis below:

House Bill 2507 would exempt from the sales tax certain tangible personal property sold to certain digital audio broadcast entities (licensed digital audio broadcasting stations that use the In-band On-channel system for broadcasting purposes) if the property  is necessary to provide certain broadcast services by federal regulations.

According to the statement of purpose for the bill, "radio transmission is a critical emergency alerting technology and that the public benefits from the transition of local radio broadcast to digital transmission."

Such specific, narrow-based exemptions usually distort the free market system by favoring a particular industry or group of businesses above others. House Bill 2507, by exempting certain tangible personal property sold to certain digital audio broadcast entities, could foster the transition of local radio broadcast to digital transmission. Picking winners and losers is not a proper role for a limited government. We oppose House Bill 2507.