Bill > SB2747

This bill introduces new restrictions on municipal sales tax incentive agreements designed to prevent municipalities from attracting businesses primarily through tax rebates or grants that simply move existing businesses from one Texas municipality to another. Specifically, the bill prohibits municipalities from entering into agreements with retailers or their affiliated groups that involve relocating or establishing a new business location unless the agreement provides a real economic benefit beyond tax advantages and the retailer has a substantial non-tax-related purpose for the move. The bill defines an "affiliated group" as having the same meaning as in existing tax code and applies to agreements where a municipality offers tax rebates, grants, or loans based on sales tax revenue. If the state comptroller determines that a municipality has violated these restrictions, the comptroller can disregard the new business location when determining sales tax collection and can revoke the business's sales tax permit. The provisions will take effect on September 1, 2025, giving municipalities and businesses time to adjust to the new regulations.

Budget and Finance, Business and Industry

https://capitol.texas.gov/BillLookup/History.aspx?LegSess=89R&Bill=SB2747