S.B. No. 1405 is a legislative measure aimed at improving broadband access and reducing taxes on Internet services in Texas. The bill redefines key terms such as "qualifying broadband service" and "unserved area," and establishes a framework for the broadband development office to provide financial incentives, including contracts, grants, and low-interest loans, to enhance broadband access in underserved regions. Notably, the bill increases the minimum required download speed for broadband from 25 megabits per second to 100 megabits per second and the upload speed from 3 megabits per second to 20 megabits per second. It also mandates the publication of statistics related to broadband service applications and reimbursements to ensure transparency.

Additionally, S.B. No. 1405 removes the previous exemption of Internet access service from certain taxable services, thereby subjecting it to taxation. The bill clarifies eligibility criteria for funding and repeals outdated provisions to streamline the funding process for broadband development initiatives. It specifies that changes in tax law will not affect tax liabilities that accrued before the bill's effective date, and amendments to the Tax Code will apply only to reports due on or after January 1, 2026. The Act is set to take effect on July 1, 2025, contingent upon a two-thirds majority vote in both legislative houses, with a fallback effective date of September 1, 2025, if the vote is not achieved.

Statutes affected:
Introduced: Government Code 403.553, Tax Code 151.00394, Tax Code 151.0101, Tax Code 171.10132 (Government Code 403, Tax Code 151, Tax Code 171)
Senate Committee Report: Government Code 403.553, Tax Code 151.00394, Tax Code 151.0101, Tax Code 171.10132 (Government Code 403, Tax Code 151, Tax Code 171)
Engrossed: Government Code 403.553, Tax Code 151.00394, Tax Code 151.0101, Tax Code 171.10132 (Government Code 403, Tax Code 151, Tax Code 171)
House Committee Report: Government Code 403.553, Tax Code 151.00394, Tax Code 151.0101, Tax Code 171.10132 (Government Code 403, Tax Code 151, Tax Code 171)
Enrolled: Government Code 403.553, Tax Code 151.00394, Tax Code 151.0101, Tax Code 171.10132 (Government Code 403, Tax Code 151, Tax Code 171)