House Bill No. 485 proposes an amendment to the Health and Safety Code, specifically adding Section 775.0755, which grants emergency services districts the authority to impose a sales tax on gas and electricity sold for residential use. This new provision allows the district's board to repeal the existing exemption for these utilities under Section 151.317 of the Tax Code by a majority vote. Additionally, the board can reinstate the exemption in the same manner. The bill mandates that the board must notify the comptroller of any orders adopted under this section, with the repeal or reinstatement of the exemption taking effect on the first day of the first calendar quarter following the comptroller's receipt of the notice.

The bill is designed to provide emergency services districts with more flexibility in funding by allowing them to tax residential utility sales, which could potentially enhance their revenue streams. The act will take effect immediately if it secures a two-thirds majority vote in both houses; otherwise, it will become effective on September 1, 2025.

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