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A BILL TO BE ENTITLED
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AN ACT
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relating to a reduction in the mixed beverage tax for certain venues |
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that present live music; authorizing a fee. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Subchapter A, Chapter 183, Tax Code, is amended |
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by adding Section 183.002 to read as follows: |
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Sec. 183.002. LIVE MUSIC PRESENTERS. (a) In this section: |
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(1) "Bar" means a retail business establishment the |
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primary purpose of which is the sale of alcoholic beverages for |
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on-premises consumption. |
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(2) "Nightclub" means a retail business establishment |
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the primary purpose of which is to provide a forum for dancing where |
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alcoholic beverages are sold for on-premises consumption. The term |
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includes a dance hall where alcoholic beverages are sold for |
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on-premises consumption. |
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(3) "Office" means the Texas Music Office in the |
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office of the governor. |
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(4) "Restaurant" means a place where food is sold for |
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on-premises consumption. |
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(b) A permittee that is a bar, nightclub, or restaurant may |
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submit an application to the comptroller to request to be |
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classified as a live music presenter. Concert halls, music halls, |
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opera halls, auditoriums, performing arts centers, and other venues |
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that are built primarily or exclusively for the performance of live |
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music are not eligible to be classified as live music presenters for |
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purposes of this section. |
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(c) An initial application to be classified as a live music |
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presenter must include: |
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(1) an application fee in an amount to be determined by |
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the comptroller; and |
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(2) a detailed description of the live music events |
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hosted by the applicant in the year preceding the date of the |
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application. |
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(d) The comptroller, in conjunction with the office, shall |
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evaluate each initial application under this section by considering |
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any factors that the comptroller and office consider necessary and |
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that the comptroller prescribes by rule. The factors must include a |
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requirement that the applicant have hosted live music events open |
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to the general public at least four nights a week in at least 45 of |
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the 52 weeks preceding the date of the application. |
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(e) An applicant that is classified as a live music |
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presenter retains that classification until the first anniversary |
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of the date of classification. |
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(f) An applicant may apply to renew a classification as a |
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live music presenter. The application must include: |
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(1) the fee and information required under Subsection |
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(c); |
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(2) a description of the estimated tax savings |
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achieved by the applicant as a result of the reduced tax rate; and |
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(3) a description of expenditures made by the |
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applicant during the preceding 12-month period related to live |
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music events. |
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(g) The comptroller, in conjunction with the office, shall |
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evaluate each application to renew a classification as a live music |
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presenter. The comptroller may renew a classification only if the |
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comptroller determines that the applicant: |
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(1) continues to comply with the requirements to |
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receive that classification under Subsection (d); and |
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(2) has used its tax savings during the preceding 12 |
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months under this section on expenditures related to expanding or |
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improving the applicant's ability to present live music. |
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(h) The comptroller by rule, after consulting with the |
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office, shall prescribe the manner in which an applicant must prove |
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compliance with Subsection (g)(2), including the manner in which |
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the applicant will estimate the amount of tax savings. |
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(i) A permittee that was classified as a live music |
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presenter at any time during the preceding 12-month period may not |
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file an initial application under Subsection (c) but may file a |
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renewal application under Subsection (f). |
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(j) For purposes of this section, expenditures related to |
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expanding or improving the ability to present live music include |
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expenditures for: |
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(1) items related to the performance of live music |
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that are eligible for the sales and use tax exemption authorized by |
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Section 151.3185(a)(2)(A) for producers of audio recordings; |
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(2) artist and technician compensation; |
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(3) sound and lighting system equipment and training; |
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(4) membership in live music-related trade |
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associations or groups; |
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(5) insurance on music-related equipment; |
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(6) labor related to music-related equipment or |
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materials, including construction related to sound mitigation; and |
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(7) any other expenditure prescribed by the |
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comptroller by rule after consulting with the office. |
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SECTION 2. Section 183.021, Tax Code, is amended to read as |
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follows: |
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Sec. 183.021. TAX IMPOSED ON MIXED BEVERAGES. (a) Except as |
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provided by Subsection (b), a [A] tax at the rate of 14 percent is |
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imposed on the gross receipts of a permittee received from the sale, |
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preparation, or service of mixed beverages or from the sale, |
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preparation, or service of ice or nonalcoholic beverages that are |
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sold, prepared, or served for the purpose of being mixed with an |
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alcoholic beverage and consumed on the premises of the permittee. |
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(b) A tax at the rate of seven percent is imposed on the |
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gross receipts of a permittee classified as a live music presenter |
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under Section 183.002 received from the sale, preparation, or |
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service of mixed beverages or from the sale, preparation, or |
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service of ice or nonalcoholic beverages that are sold, prepared, |
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or served for the purpose of being mixed with an alcoholic beverage |
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and consumed on the premises of the live music presenter. |
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SECTION 3. This Act takes effect September 1, 2013. |