The bill, H.B. No. 2962, proposes an amendment to Section 182.022(d) of the Texas Tax Code, which exempts the gross receipts from the sale of electricity to political subdivisions from taxation. The current language specifying "public school district customer" is deleted, and the term "political subdivision" is inserted, broadening the scope of the exemption to include all political subdivisions rather than just public school districts.

Additionally, the bill mandates that the Public Utility Commission of Texas and retail electric providers adjust their billing for political subdivisions to reflect any decrease in tax liability resulting from this exemption. These adjustments must be made promptly following the effective date of the bill, which is set for September 1, 2025. The bill ensures that the adjustments are not classified as rate cases under existing utility regulations, streamlining the process for implementing the tax exemption.

Statutes affected:
Introduced: Tax Code 182.022 (Tax Code 182)