Highlights 77th Texas Legislature - Senate

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77 th Texas Legislature
Provides that an insurance organization performing management or accounting activities in this state on
behalf of a nonadmitted captive insurance company that is required to pay a gross premium receipts tax
during a tax year is exempted from the franchise tax for that same year.
Authorizes a surviving corporation of a merger, for reports originally due on or after January 1, 2004, to
claim the business loss of the nonsurviving corporation. Such business losses may be carried forward not
more than five years following the merger or until the losses are exhausted.
Tax Exemption for Goods in Transit - S.J.R. 6
by Senator Duncan, et al.
House Sponsor: Representative Gallego
Currently, the state provides for a "freeport exemption." This exemption, which can be granted at the
option of each city, county, school district, or junior college district, exempts goods, wares, ores, raw
materials, and other types of inventory that are brought into or acquired in the state and transported out of
the state within 175 days of acquisition. The proposed amendment would provide a similar exemption for
property acquired or imported into Texas, stored at a location in the state not owned or under the control of
the property owner, and transported to another location either inside or outside of the state within 270 days.
The proposed amendment would provide a local option procedure to continue taxing the property. Texas
law does not provide an ad valorem taxation exemption to certain tangible personal property held
temporarily for commercial purposes. S.J.R. 6 proposes a constitutional amendment that exempts certain
personal property from ad valorem taxation.
Proposes a constitutional amendment to provide for a new exemption for goods-in-transit.
Authorizes the legislature by general law to exempt from ad valorem taxation goods, wares, merchandise,
other tangible personal property, and ores, other than oil, natural gas, and other petroleum products, to
promote economic development in this state if the property is:
• acquired in or imported into this state to be forwarded to another location in this state or outside
this state, whether the intention to forward the property to another location in this state or outside
this state is formed or the destination to which the property is forwarded is specified when the
property is acquired in or imported into this state;
• detained at a location in this state that is not owned or under the control of the property owner for
certain purposes by the person who acquired or imported the property; and
• transported to another location in this state or outside of this state not later than 270 days after the
date the person acquired the property in or imported the property into this state.
Authorizes a property owner who is eligible to receive the freeport exemption to apply for the goods-intransit
exemption. Prohibits a property owner who receives the goods-in-transit exemption from receiving
the freeport exemption for the same property.
Senate Research Center 296