House Bill No. 2825 proposes amendments to the Texas Tax Code regarding sales and use tax rates for certain tangible personal property utilized in providing cable television, Internet access, and telecommunications services. Effective January 1, 2028, the bill introduces a new section, 151.3187, which establishes a reduced tax rate of four percent on the sale, lease, rental, or consumption of such property when it is used by providers or their subsidiaries in the distribution of cable services, provision of Internet access, or transmission of telecommunications services. The bill also specifies that this reduced rate does not apply to property used in data processing or information services, nor does it affect taxes authorized under Subtitle C, Title 3.

Additionally, the bill repeals Section 151.3186 of the Tax Code, while ensuring that any refunds owed to taxpayers who filed claims before the effective date of the new law remain unaffected. The comptroller is tasked with adopting rules to implement the new section, including provisions for partial refunds of taxes collected at the previous rate. The overall changes aim to provide tax relief for service providers in the telecommunications sector while maintaining the integrity of tax liabilities accrued prior to the enactment of this bill. The act is set to take effect on January 1, 2027, with specific provisions for the transition of tax liabilities.

Statutes affected:
Introduced: Tax Code 151.3186 (Tax Code 151)
House Committee Report: Tax Code 151.3186 (Tax Code 151)