House Ways & Means met on March 15 to discuss a number of bills. This report covers discussions on HB 533 (Shine), HB 1195 (Geren et al.), HB 1445 (Oliverson). A video of the hearing can be found here.
This report is intended to give you an overview and highlight of the discussions on the various topics taken up. It is not a verbatim transcript of the discussions but is based upon what was audible or understandable to the observer and the desire to get details out as quickly as possible with few errors or omissions.
Opening Comments
Meyer – Intend to vote out bills later this week
HB 1195 (CS) (Geren et al.) – Relating to the forgiveness of a loan made under the Paycheck Protection Program for franchise tax purposes
- Geren – Legislation is presented to ensure PPP loans that are not subject to state franchise taxes; should exempt forgiven PPP loans
- CS was in response to IRS guidance; adds they are not considered gross receipts for franchise tax reasons
- Button – Notes CPAs they have been in contact with support this bill
Martin Gutierrez, San Antonio Hispanic Chamber of Commerce – For
- Economic relief for small business impacted by COVID-19; need a legislative fix and should not be required to pay these unexpected franchise taxes
Annie Spilman, NFIB – For
- Legislation is needed in order to not burden the businesses owners who were shuttered by the pandemic
- Meyer – Is it true about 36 states have already done this?
- Yes
CS is withdrawn, HB 1196 is left pending
HB 1445 (Oliverson) (CS) – Relating to the applicability of the sales and use tax to certain insurance services
- Oliverson – Comptroller concluded after the 86th there was nothing specific in the code that prevented certain billing collections
- Currently, this legislation preventing the reinstitution of a tax that has not been collected in 20 years on third party billing
- Becomes difficult for the average family practice to handle this on their own; if this is not handled, could cause an additional tax
- CS includes dental practices, Medicaid, and CHIP
- Meyer – What is the fiscal note on this?
- There is no fiscal note, and does not expect one
- Thierry – If we do not do anything, this will put a tax on something we currently do not and would increase healthcare costs?
- Yes, would be an additional tax on claims and reduce the reimbursement; will increase the overhead and pass the cost on to the consumer
- Murphy – Third party services are used to create efficiency, could hurt the smaller practices and the larger practices as well?
- Yes, technical expertise to assess these claims has increased dramatically; to find someone in-house would be hard and expensive
Dr. Yasser Zeid, TMA – For
- Small physician practices rely on third-party billing; legislation will prevent a potential increase in the cost of health care for practices and consumers
CS is withdrawn, HB 1445 is left pending
HB 533 (Shine) – Relating to ad valorem tax sales of personal property seized under a tax warrant
- Shine – Under the current tax bracket restriction, only Harris County is authorized to conduct an online sale of personal property
- This bill allows all counties to conduct selling of personal property
- Murphy – Like this bill, but is optional? Could do courthouse sales?
- Believes so
- Meyer – What benefits would taxing units see?
- Resource witness would be able to answer this
Karey Barton, Associate Deputy Comptroller for Tax – Resource Witness
- No questions
Chris Young, Linebarger Goggan Blair & Sampson LLP – For
- This bill essentially expands the market; ability for all counties to reach a broader market
HB 533 is left pending