Bill Text: TX HB4013 | 2019-2020 | 86th Legislature | Comm Sub
Bill Title: Relating to sales and use taxes on e-cigarettes and vapor products; imposing taxes; providing an administrative penalty; authorizing the imposition of a fee.
Spectrum: Moderate Partisan Bill (Republican 5-1)
Status: (Introduced - Dead) 2019-05-09 - Returned to committee [HB4013 Detail]
Download: Texas-2019-HB4013-Comm_Sub.html
86R19909 SRA-D | |||
By: Miller, Thierry, Zerwas, Oliverson, | H.B. No. 4013 | ||
Springer, et al. | |||
Substitute the following for H.B. No. 4013: | |||
By: Murphy | C.S.H.B. No. 4013 |
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relating to sales and use taxes on e-cigarettes and vapor products; | ||
imposing taxes; providing an administrative penalty; authorizing | ||
the imposition of a fee. | ||
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: | ||
SECTION 1. Subtitle E, Title 2, Tax Code, is amended by | ||
adding Chapter 164 to read as follows: | ||
CHAPTER 164. TAX ON E-CIGARETTES AND VAPOR PRODUCTS | ||
Sec. 164.0001. DEFINITIONS. In this chapter: | ||
(1) "E-cigarette" has the meaning assigned by Section | ||
161.081, Health and Safety Code. | ||
(2) "Vapor product" means a consumable liquid solution | ||
or other material aerosolized or vaporized during the use of an | ||
e-cigarette, regardless of whether the liquid contains nicotine. | ||
Sec. 164.0002. E-CIGARETTE AND VAPOR PRODUCT SALES TAX. | ||
(a) A tax is imposed on each sale of an e-cigarette or vapor product | ||
in this state. | ||
(b) The tax rate is 10 percent of the sales price of an | ||
e-cigarette or vapor product sold. | ||
(c) A tax imposed under this section is in addition to the | ||
tax imposed under Subchapter C, Chapter 151. A tax imposed under | ||
this section does not apply to a sale unless the tax imposed under | ||
Subchapter C, Chapter 151, applies to the sale. | ||
Sec. 164.0003. E-CIGARETTE AND VAPOR PRODUCT USE TAX. (a) | ||
A tax is imposed on the storage, use, or other consumption in this | ||
state of an e-cigarette or vapor product purchased from a retailer | ||
for storage, use, or other consumption in this state. | ||
(b) The tax rate is 10 percent of the sales price of an | ||
e-cigarette or vapor product stored, used, or otherwise consumed in | ||
this state. | ||
(c) A tax imposed under this section is in addition to the | ||
tax imposed under Subchapter D, Chapter 151. A tax imposed under | ||
this section does not apply to the storage, use, or other | ||
consumption of an e-cigarette or vapor product unless the tax | ||
imposed under Subchapter D, Chapter 151, applies to the storage, | ||
use, or other consumption. | ||
Sec. 164.0004. APPLICATION OF OTHER PROVISIONS OF CODE. | ||
(a) Except as provided by this chapter: | ||
(1) the taxes imposed under this chapter are | ||
administered, imposed, collected, and enforced in the same manner | ||
as the taxes under Chapter 151 are administered, imposed, | ||
collected, and enforced; and | ||
(2) the provisions of Chapter 151 applicable to the | ||
sales tax imposed under Subchapter C, Chapter 151, and the use tax | ||
imposed under Subchapter D, Chapter 151, apply to the sales and use | ||
taxes imposed under this chapter. | ||
(b) A change in the law relating to the taxation of the sale | ||
or use of an e-cigarette or vapor product under Chapter 151 also | ||
applies to the sales or use tax imposed under this chapter. | ||
Sec. 164.0005. REPORTS. (a) A person required to file a | ||
report under Section 151.403 who is also required to collect or pay | ||
a tax under this chapter shall file with the comptroller a report | ||
stating: | ||
(1) for sales tax purposes, the amount of total | ||
receipts from e-cigarettes and vapor products sold by the seller | ||
during the reporting period; | ||
(2) for use tax purposes, the amount of total receipts | ||
from e-cigarettes and vapor products sold by the retailer during | ||
the reporting period for storage, use, or other consumption in this | ||
state; | ||
(3) the amount of the total sales prices of | ||
e-cigarettes and vapor products subject to the use tax that were | ||
acquired during the reporting period for storage, use, or other | ||
consumption in this state by a purchaser who did not pay the tax to a | ||
retailer; | ||
(4) the amount of the taxes due under this chapter for | ||
the reporting period; and | ||
(5) any other information required by the comptroller. | ||
(b) The report required by this section for a reporting | ||
period is due on the same date that the tax payment for the period is | ||
due. | ||
Sec. 164.0006. RECORDS. (a) A person required to file a | ||
report under Section 151.403 who is also required to collect or pay | ||
a tax under this chapter shall keep a complete record of: | ||
(1) all gross receipts from each sale to which this | ||
chapter applies occurring during each reporting period, along with | ||
documentation relating to those receipts; | ||
(2) all purchases of e-cigarettes and vapor products, | ||
including the constituent parts of e-cigarettes and vapor products, | ||
from every source during each reporting period, along with | ||
documentation relating to those purchases; | ||
(3) all sales and use taxes, and any money represented | ||
to be sales or use tax, collected under this chapter during each | ||
reporting period; and | ||
(4) any other information required by the comptroller. | ||
(b) A person shall keep the records required by Subsection | ||
(a) for the period required by Section 151.025(b). | ||
Sec. 164.0007. DISPOSITION OF PROCEEDS. The comptroller | ||
shall deposit the proceeds from taxes imposed under this chapter to | ||
the credit of the foundation school fund. | ||
Sec. 164.0008. DISCIPLINARY ACTION FOR CERTAIN VIOLATIONS. | ||
(a) A person required to file a report under Section 151.403 who is | ||
also required to collect or pay a tax under this chapter is subject | ||
to disciplinary action as provided by this section if: | ||
(1) an agent or employee of the person commits an | ||
offense under Subchapter H, Chapter 161, Health and Safety Code; | ||
and | ||
(2) the person, with criminal negligence, failed to | ||
prevent the offense through adequate supervision and training of | ||
the agent or employee. | ||
(b) If the comptroller finds, after notice and an | ||
opportunity for a hearing, that a person described by Subsection | ||
(a) has violated Subchapter H, Chapter 161, Health and Safety Code, | ||
at a place of business for which a sales tax permit under Chapter | ||
151 has been issued, the comptroller may suspend the permit for that | ||
place of business or administratively assess a fine as follows: | ||
(1) if the person has not been found to have violated | ||
Subchapter H, Chapter 161, Health and Safety Code, at that place of | ||
business during the preceding 12 months, the comptroller may | ||
require the person to pay a fine in an amount not to exceed $500; | ||
(2) if the person has been found to have violated | ||
Subchapter H, Chapter 161, Health and Safety Code, at that place of | ||
business once during the preceding 12 months, the comptroller may | ||
require the person to pay a fine in an amount not to exceed $750; and | ||
(3) if the person has been found to have violated | ||
Subchapter H, Chapter 161, Health and Safety Code, at that place of | ||
business at least twice during the preceding 12 months, the | ||
comptroller may require the person to pay a fine in an amount not to | ||
exceed $1,000 or suspend the sales tax permit for that place of | ||
business for not more than three days. | ||
(c) Except as provided by Section 164.0009, if the person | ||
has been found to have violated Section 161.082(b), Health and | ||
Safety Code, on four or more previous and separate occasions at the | ||
same place of business during the preceding 24 months, the | ||
comptroller shall revoke the sales tax permit for that place of | ||
business. | ||
(d) A person whose sales tax permit has been revoked under | ||
this section may not apply for a sales tax permit under Chapter 151 | ||
for the same place of business before the expiration of six months | ||
after the effective date of the revocation. | ||
Sec. 164.0009. ACTIONS OF EMPLOYEE. (a) For purposes of | ||
Subchapter H, Chapter 161, Health and Safety Code, relating to the | ||
sale or delivery of e-cigarettes to a minor, the comptroller may | ||
suspend a sales tax permit of a person required to file a report | ||
under Section 151.403 who is also required to collect or pay a tax | ||
under this chapter but may not revoke the permit under Section | ||
164.0008 if the comptroller finds that: | ||
(1) the person has not violated Section 161.082(b), | ||
Health and Safety Code, more than four times at the place of | ||
business for which the permit is issued in the 24-month period | ||
preceding the violation in question; | ||
(2) the person requires its employees to attend a | ||
comptroller-approved seller training program; | ||
(3) the employee has actually attended a | ||
comptroller-approved seller training program; and | ||
(4) the person has not directly or indirectly | ||
encouraged the employee to violate the law. | ||
(b) The comptroller shall adopt rules or policies | ||
establishing the minimum requirements for approved seller training | ||
programs. On application, the comptroller shall approve seller | ||
training programs meeting the requirements that are sponsored | ||
privately or by public community colleges. The comptroller may | ||
charge an application fee in an amount necessary to defray the | ||
expense of processing the application. | ||
(c) The comptroller may approve under this section a seller | ||
training program sponsored by a person described by Subsection (a) | ||
for the purpose of training the person's employees without regard | ||
to whether the employees are located at the same place of business. | ||
This subsection applies only to a person who employs at least 100 | ||
persons at any one time during the permit year who sell | ||
e-cigarettes. | ||
SECTION 2. This Act takes effect September 1, 2019. |