| (v) a telecommunications provider as defined by Utilities
Code, §51.002; or
(vi) a cable service provider or video service provider
as defined by Utilities Code, §66.002.
(5) Imposition of city sales tax and transit tax on
certain military installations; El Paso and Fort Bliss. Pursuant to
Tax Code, §321.1045 (Imposition of Sales and Use Tax in Certain
Federal Military Installations), for purposes of the local sales and
use tax imposed under Tax Code, Chapter 321, the city of El Paso includes
the area within the boundaries of Fort Bliss to the extent it is in
the city's extraterritorial jurisdiction. However, the El Paso transit
authority does not include Fort Bliss. See Transportation Code, §453.051
concerning the Creation of Transit Departments.
(m) Restrictions on local sales tax rebates and other
economic incentives. Pursuant to Local Government Code, §501.161,
Section 4A and 4B development corporations may not offer to provide
economic incentives, such as local sales tax rebates authorized under
Local Government Code, Chapters 380 or 381, to persons whose business
consists primarily of purchasing taxable items using resale certificates
and then reselling those same items to a related party. A related
party means a person or entity which owns at least 80% of the business
enterprise to which sales and use taxes would be rebated as part of
an economic incentive.
(n) Prior contract exemptions. The provisions of §3.319
of this title (relating to Prior Contracts) concerning definitions
and exclusions apply to prior contract exemptions.
(1) Certain contracts and bids exempt. No local taxes
are due on the sale, use, storage, or other consumption in this state
of taxable items used:
(A) for the performance of a written contract executed
prior to the effective date of any local tax if the contract may not
be modified because of the tax; or
(B) pursuant to the obligation of a bid or bids submitted
prior to the effective date of any local tax if the bid or bids and
contract entered into pursuant thereto are at a fixed price and not
subject to withdrawal, change, or modification because of the tax.
(2) Annexations. Any annexation of territory into an
existing local taxing jurisdiction is also a basis for claiming the
exemption provided by this subsection.
(3) Local taxing jurisdiction rate increase; partial
exemption for certain contracts and bids. When an existing local taxing
jurisdiction raises its sales and use tax rate, the additional amount
of tax that would be due as a result of the rate increase is not due
on the sale, use, storage, or other consumption in this state of taxable
items used:
(A) for the performance of a written contract executed
prior to the effective date of the tax rate increase if the contract
may not be modified because of the tax; or
(B) pursuant to the obligation of a bid or bids submitted
prior to the effective date of the tax rate increase if the bid or
bids and contract entered into pursuant thereto are at a fixed price
and not subject to withdrawal, change, or modification because of
the tax.
(4) Three-year statute of limitations.
(A) The exemption in paragraph (1) of this subsection
and the partial exemption in paragraph (3) of this subsection have
no effect after three years from the date the adoption or increase
of the tax takes effect in the local taxing jurisdiction.
(B) The provisions of §3.319 of this title apply
to this subsection to the extent they are consistent.
(C) Leases. Any renewal or exercise of an option to
extend the time of a lease or rental contract under the exemptions
provided by this subsection shall be deemed to be a new contract and
no exemption will apply.
(5) Records. Persons claiming the exemption provided
by this subsection must maintain records which can be verified by
the comptroller or the exemption will be lost.
(6) Exemption certificate. An identification number
is required on the prior contract exemption certificates furnished
to sellers. The identification number should be the person's 11-digit
Texas taxpayer number or federal employer's identification (FEI) number.
|
| Source Note: The provisions of this §3.334 adopted to be effective January 1, 2015, 39 TexReg 9597; amended to be effective January 5, 2016, 41 TexReg 260; amended to be effective May 31, 2020, 45 TexReg 3499 |
