HB 297 — An exemption from sales

90R406 CJD-F By: Martinez Fischer H.B. No. 297 relating to an exemption from sales and use taxes for certain qualified tools and equipment for a limited period.

SECTION 1. Subchapter H, Chapter 151, Tax Code, is amended by adding Section 151.360 to read as follows: Sec. 151.360. CERTAIN QUALIFIED TOOLS AND EQUIPMENT FOR LIMITED PERIOD. (a) In this section, "qualified tool or equipment item" means: (1) an item listed in this subdivision, the sales price of which is less than the greater of $225 or the amount provided by Subsection (c): (A) a power tool; (B) a pair of work boots; (C) a job box, toolbox, or tool organizer; or (D) an industry textbook or codebook; or (2) an item listed in this subdivision, the sales price of which is less than the greater of $100 or the amount provided by Subsection (c): (A) a hand tool; (B) a pair or set of safety glasses; (C) protective coveralls; or (D) a pair of work gloves. (b) The sale of a qualified tool or equipment item is exempted from the taxes imposed by this chapter if the sale takes place during a period beginning at 12:01 a.m. on the Friday preceding the first Monday in September and ending at 11:59 p.m. on the first Monday in September. (c) Beginning January 1, 2029, on January 1 of each fifth year, the amounts prescribed by Subsections (a)(1) and (2), respectively, are increased by an amount equal to the amount prescribed by the applicable subsection on December 31 of the preceding year, as previously adjusted under this subsection, multiplied by the cumulative percentage increase, if any, in the consumer price index during the preceding five-year period and rounded to the nearest five dollars. In this subsection, "consumer price index" means the average over a state fiscal year of the Consumer Price Index for All Urban Consumers (CPI-U), U.S. City Average, published monthly by the United States Bureau of Labor Statistics or its successor in function.

SECTION 2. The change in law made by this Act does not affect tax liability accruing before the effective date of this Act. That liability continues in effect as if this Act had not been enacted, and the former law is continued in effect for the collection of taxes due and for civil and criminal enforcement of the liability for those taxes.

SECTION 3. This Act takes effect September 1, 2028.