| (3) Any provisions in this section or other sections
of this title related to a seller's responsibilities for collecting
and remitting local taxes to the comptroller shall also apply to a
purchaser if the seller does not collect local taxes that are due.
The comptroller may proceed against the seller or purchaser for the
local tax owed by either.
(f) Tax rates. Except as otherwise provided by law,
no local governmental entity may adopt or increase a sales and use
tax if, as a result of the adoption or increase of the tax, the combined
rate of all sales and use taxes imposed by local taxing jurisdictions
having territory in the local governmental entity would exceed 2.0%
at any location within the boundaries of the local governmental entity's
jurisdiction. The following are the local tax rates that may be adopted.
(1) Cities. Cities may impose sales and use tax at
a rate of up to 2.0%.
(2) Counties. Counties may impose sales and use tax
at rates ranging from 0.5% to 1.5%.
(3) Special purpose districts. Special purpose districts
may impose sales and use tax at rates ranging from 0.125% to 2.0%.
(4) Transit authorities. Transit authorities may impose
sales and use tax at rates ranging from 0.25% to 1.0%.
(g) Jurisdictional boundaries, combined areas, and
city tax imposed through strategic partnership agreements.
(1) Jurisdictional boundaries.
(A) City boundaries. City taxing jurisdictional boundaries
cannot overlap one another and a city cannot impose a sales and use
tax in an area that is already within the jurisdiction of another
city.
(B) County boundaries. County tax applies to all locations
within that county.
(C) Special purpose district and transit authority
boundaries. Special purpose districts and transit authorities may
cross or share boundaries with other local taxing jurisdictions and
may encompass, in whole or in part, other local taxing jurisdictions,
including cities and counties. A geographic location or address in
this state may lie within the boundaries of more than one special
purpose district or more than one transit authority.
(D) Extraterritorial jurisdictions. Except as otherwise
provided by paragraph (3) of this subsection concerning strategic
partnership agreements and subsection (l)(5) of this section concerning
the City of El Paso and Fort Bliss, city sales and use tax does not
apply to taxable sales that are consummated outside the boundaries
of the city, including sales made in a city's extraterritorial jurisdiction.
However, an extraterritorial jurisdiction may lie within the boundaries
of a special purpose district, transit authority, county, or any combination
of the three, and the sales and use taxes for those jurisdictions
would apply to those sales.
(2) Combined areas. A combined area is an area where
the boundaries of a city overlap the boundaries of one or more other
local taxing jurisdictions as a result of an annexation of additional
territory by the city, and where, as the result of the imposition
of the city tax in the area in addition to the local taxes imposed
by the existing taxing jurisdictions, the combined local tax rate
would exceed 2.0%. The comptroller shall make accommodations to maintain
a 2.0% rate in any combined area by distributing the 2.0% tax revenue
generated in these combined areas to the local taxing jurisdictions
located in the combined areas as provided in Tax Code, §321.102
or Health and Safety Code, §775.0754. Combined areas are identified
on the comptroller's website. Sellers engaged in transactions on which
local sales or use taxes are due in a combined area, or persons who
must self-accrue and remit tax directly to the comptroller, must use
the combined area local code when reporting the tax rather than the
codes for the individual city, county, special purpose districts,
or transit authorities that make up the combined area.
(3) City tax imposed through strategic partnership
agreements.
(A) The governing bodies of a district, as defined
in Local Government Code, §43.0751, and a city may enter into
a limited-purpose annexation agreement known as a strategic partnership
agreement. Under this agreement, the city may impose sales and use
tax within all or part of the boundaries of a district. Areas within
a district that are annexed for this limited purpose are treated as
though they are within the boundaries of the city for purposes of
city sales and use tax.
(B) Counties, transit authorities, and special purpose
districts may not enter into strategic partnership agreements. Sales
and use taxes imposed by those taxing jurisdictions do not apply in
the limited-purpose annexed area as part of a strategic partnership
agreement between a city and an authorized district. However, a county,
special purpose district, or transit authority sales and use tax,
or any combination of these three types of taxes, may apply at locations
included in a strategic partnership agreement between a city and an
authorized district if the tax is imposed in that area by the applicable
jurisdiction as allowed under its own controlling authorities.
(C) Prior to September 1, 2011, the term "district"
was defined in Local Government Code, §43.0751 as a municipal
utility district or a water control and improvement district. The
definition was amended effective September 1, 2011, to mean a conservation
and reclamation district operating under Water Code, Chapter 49.
(h) Places of business of the seller and job sites
crossed by local taxing jurisdiction boundaries.
(1) Places of business of the seller crossed by local
taxing jurisdiction boundaries. If a place of business of the seller
is crossed by one or more local taxing jurisdiction boundaries so
that a portion of the place of business of the seller is located within
a taxing jurisdiction and the remainder of the place of business of
the seller lies outside of the taxing jurisdiction, tax is due to
the local taxing jurisdictions in which the sales office is located.
If there is no sales office, sales tax is due to the local taxing
jurisdictions in which any cash registers are located.
(2) Job sites.
(A) Residential repair and remodeling; new construction
of an improvement to realty. When a contractor is improving real property
under a separated contract, and the job site is crossed by the boundaries
of one or more local taxing jurisdictions, the local taxes due on
any separately stated charges for taxable items incorporated into
the real property must be allocated to the local taxing jurisdictions
based on the total square footage of the real property improvement
located within each jurisdiction, including the square footage of
any standalone structures that are part of the construction, repair,
or remodeling project. For more information about tax due on materials
used at residential and new construction job sites, refer to §3.291
of this title (relating to Contractors).
(B) Nonresidential real property repair and improvement.
When taxable services are performed to repair, remodel, or restore
nonresidential real property, including a pipeline, transmission line,
or parking lot, that is crossed by the boundaries of one or more local
taxing jurisdictions, the local taxes due on the taxable services,
including materials and any other charges connected to the services
performed, must be allocated among the local taxing jurisdictions
based upon the total mileage or square footage, as appropriate, of
the repair, remodeling, or restoration project located in each jurisdiction.
For more information about tax due on materials used at nonresidential
real property repair and remodeling job sites, refer to §3.357
of this title (relating to Nonresidential Real Property Repair, Remodeling,
and Restoration; Real Property Maintenance).
(i) Sellers' and purchasers' responsibilities for collecting
or accruing local taxes.
(1) Sale consummated in Texas; seller responsible for
collecting local sales taxes and applicable local use taxes. When
a sale of a taxable item is consummated at a location in Texas as
provided by subsection (c) of this section, the seller must collect
each local sales tax in effect at the location. If the total rate
of local sales tax due on the sale does not reach the two percent
cap, and the seller ships or delivers the item into another local
taxing jurisdiction, then the seller is required to collect additional
local use taxes due, if any, based on the location to which the item
is shipped or delivered or at which the purchaser of the item takes
possession, regardless of the location of the seller in Texas. For
more information regarding local use taxes, refer to subsection (d)
of this section.
(2) Out-of-state sale; seller engaged in business in
Texas. Except as provided in paragraph (3) of this subsection, when
a sale is not consummated in Texas, a seller who is engaged in business
in this state is required to collect and remit local use taxes due,
if any, on orders of taxable items shipped or delivered at the direction
of the purchaser into a local taxing jurisdiction in this state based
upon the location in this state to which the item is shipped or delivered
or at which the purchaser of the item takes possession as provided
Cont'd... |
