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<br />80(R) HB 621 - Enrolled version - Fiscal Note <br /> <br />http://www.capitol.state.tx.us/tlodocs/80R/fiscalnotes/ht. . <br /> <br />The exemption would have to be granted by all taxing units unless the <br />governing body of a taxing unit proposed by official action to tax goods in <br />transit. Before acting to tax goods in transit, the governing body of a taxing <br />unit would have to conduct a public hearing where the public would be <br />allowed to speak for or against the action to tax the property. <br /> <br />The bill would take effect January 1,2008. <br /> <br />Methodology <br /> <br />Currently, Article VIII, Section 1-j of the Texas Constitution and Section <br />11.251 of the Tax Code provide for a " freeport exemption." This <br />exemption, which can be granted at the option of each city, county, school <br />district, or junior college district, exempts goods, wares, ores, raw <br />materials, and other types of inventory that are brought into or acquired in <br />the state and transported out of the state within 175 days of acquisition. <br /> <br />In November 2001, Texas voters approved of the amendment proposed in <br />SJR 6, adding Article VIII, Section 1-n to the Texas Constitution. This <br />amendment authorized the Legislature to exempt from ad valorem taxation <br />"goods in transit." <br /> <br />The enabling legislation proposed in the. bill would provide an exemption <br />for property acquired in Texas or imported into Texas if the property is <br />stored at a location in which the owner of the goods does not have a direct <br />or indirect ownership interest and is transported to another location either <br />inside or outside of the state within 175 days. The bill would provide a <br />local option procedure to continue taxing the property. <br /> <br />The proposed exemption could cause an undetermined revenue loss to <br />cities, counties, school districts, and junior college districts exempting <br />goods in transit. <br /> <br />Because the state is constitutionally prohibited from imposing a state <br />property tax, there would be no direct fiscal impact on the state. However, <br />Section 403.302 of the Government Code requires the Comptroller to <br /> <br />30f4 <br /> <br />7/3/2007 9:08 AN <br />