H.B. No. 1109 proposes an amendment to the Texas Tax Code to exempt counties from certain motor fuel taxes. Specifically, the bill adds provisions that allow counties to purchase gasoline and diesel fuel for their exclusive use without incurring the tax. The new legal language includes the insertion of "sold to a county in this state for the county's exclusive use" in both Sections 162.104 and 162.204, which pertain to gasoline and diesel fuel, respectively. Additionally, the bill introduces a new subsection (g-3) in both Sections 162.125 and 162.227, allowing counties that are exempt from the tax to claim a refund for any taxes paid on fuel purchases.

The bill also clarifies that the tax exemptions do not apply to fuel sold or delivered to individuals or entities operating under contracts with the United States. Furthermore, it ensures that the changes in law do not affect any tax liabilities that accrued before the effective date of the Act, which is set for July 1, 2025, contingent upon receiving a two-thirds vote from both houses of the legislature. If the necessary vote is not achieved, the Act will take effect on September 1, 2025.

Statutes affected:
Introduced: Tax Code 162.104, Tax Code 162.125, Tax Code 162.204, Tax Code 162.227 (Tax Code 162)
House Committee Report: Tax Code 162.104, Tax Code 162.125, Tax Code 162.204, Tax Code 162.227 (Tax Code 162)