HB 230 — Sales and use tax refunds

90R3394 MXM-D By: Guillen H.B. No. 230 relating to sales and use tax refunds for certain persons who employ apprentices.

SECTION 1. Subchapter I, Chapter 151, Tax Code, is amended by adding Section 151.4293 to read as follows: Sec. 151.4293. TAX REFUNDS FOR CERTAIN PERSONS WHO EMPLOY APPRENTICES. (a) In this section: (1) "Executive director" means the executive director of the Texas Workforce Commission. (2) "Qualified apprenticeship" means an apprenticeship program that is: (A) certified as an industry-recognized apprenticeship program by an entity determined to meet United States Department of Labor criteria; or (B) registered with the United States Department of Labor and qualified to receive funding provided through the Texas Workforce Commission under Chapter 133, Education Code. (b) A person is eligible for a refund in the amount and under the conditions provided by this section of the taxes paid under this chapter during a calendar year if the person is certified by the executive director under Subsection (f) and employs at least one apprentice in a qualified apprenticeship position for at least seven months during the calendar year. A person is not considered to be employed in a qualified apprenticeship position for purposes of this section: (1) after the earlier of: (A) the fourth anniversary of employment in the position; or (B) the conclusion of the term of the apprenticeship position; or (2) if the person was employed in another position by the employer immediately before beginning employment in the apprenticeship position. (c) Subject to Subsections (d) and (e), the amount of the refund for a calendar year in connection with each apprentice described by Subsection (b) is $2,500. (d) The total amount of the refund for a calendar year is equal to the lesser of: (1) the amount allowed under Subsection (c) for the calendar year for each apprentice described by Subsection (b), not to exceed the maximum number of apprentices provided by Subsection (e); or (2) the amount of sales and use taxes paid by the person during the calendar year. (e) The maximum number of apprentices in connection with whom a person may receive a refund in a calendar year is: (1) one; or (2) not more than six if at least half of the apprentices employed are: (A) foster children who have transitioned or are transitioning to independent living, as described in Section 264.121, Family Code; (B) military veterans, as defined by Section 55.001, Occupations Code; (C) military spouses, as defined by Section 55.001, Occupations Code; or (D) women. (f) A person may not apply for a refund under this section unless the executive director certifies that the person is able to employ apprentices in qualified apprenticeships. A person must apply to the executive director to obtain certification. The executive director shall create an application form for the certification. (g) The executive director may certify not more than 100 persons under Subsection (f) at any time. If the number of eligible applicants exceeds the limit provided by this subsection, the executive director shall select applicants for certification according to rules adopted under Subsection (h). (h) The executive director shall adopt rules that establish merit-based criteria for selecting persons to certify from among those who apply. The rules must require that the executive director give preference to applicants who: (1) offer qualified apprenticeships in areas of this state that are not designated as metropolitan statistical areas by the United States Office of Management and Budget; and (2) provide training and skills development in emerging or developing occupational fields. (i) The executive director shall issue a certificate to each person certified under Subsection (f). The certificate must confirm that the person is eligible to apply for a refund under this section. (j) A person must apply to the comptroller for a refund under this section. The person must include with the application the certificate issued to the person under Subsection (i) and any other information the comptroller requires.

SECTION 2. A person may apply for a refund under Section 151.4293, Tax Code, as added by this Act, only in connection with apprentices first employed on or after January 1, 2027.

SECTION 3. This Act takes effect immediately if it receives a vote of two-thirds of all the members elected to each house, as provided by Section 39, Article III, Texas Constitution. If this Act does not receive the vote necessary for immediate effect, this Act takes effect September 1, 2027.