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  82R3516 CJC-D
 
  By: Farias H.B. No. 2214
 
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to the imposition of a tax on certain sweetened beverages
  and ingredients used to make certain sweetened beverages and to the
  use of the revenue for the promotion of children's health programs;
  providing penalties.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Subtitle E, Title 2, Tax Code, is amended by
  adding Chapter 163 to read as follows:
  CHAPTER 163. TAX ON SWEETENED BEVERAGES
  SUBCHAPTER A. GENERAL PROVISIONS
         Sec. 163.001.  DEFINITIONS. In this chapter:
               (1)  "Retailer" means a person, other than a
  manufacturer, distributor, or wholesaler, who receives, stores,
  mixes, compounds, or manufactures sweetened beverages and who sells
  or otherwise distributes sweetened beverages to the ultimate
  consumer.
               (2)  "Sweetened beverage" means a carbonated or
  non-carbonated nonalcoholic beverage that contains natural or
  artificial sweeteners. The term does not include:
                     (A)  a beverage that:
                           (i)  is sweetened only by a sweetener that
  does not add calories to the beverage;
                           (ii)  is 100 percent vegetable or fruit
  juice by volume;
                           (iii)  contains more than one-half of one
  percent alcohol per ounce;
                           (iv)  is commonly referred to as a "sports
  drink" or "electrolyte replacement drink" and contains not more
  than 110 milligrams of potassium and 200 milligrams of sodium per
  eight-ounce serving;
                           (v)  is intended by the manufacturer for
  consumption by an infant and is commonly referred to as "infant
  formula"; or
                           (vi)  is intended by the manufacturer to be
  sold and used by the ultimate consumer in domestically mixing soft
  drinks;
                     (B)  milk or milk products that do not contain
  sweeteners that add calories to the milk or milk products;
                     (C)  non-carbonated water or water without any
  additional substances except for minerals and flavoring agents that
  do not add calories to the water; or
                     (D)  coffee or tea that does not contain
  sweeteners that add calories to the coffee or tea.
               (3)  "Sweetened beverage powder" means a solid mixture
  of basic ingredients used to make, mix, or compound sweetened
  beverages.
               (4)  "Sweetened beverage syrup" means a liquid mixture
  of basic ingredients used to make, mix, or compound sweetened
  beverages.
  [Sections 163.002-163.050 reserved for expansion]
  SUBCHAPTER B. IMPOSITION AND COLLECTION OF TAX
         Sec. 163.051.  TAX IMPOSED ON SWEETENED BEVERAGES. (a) A
  tax is imposed on the sale to a retailer of a sweetened beverage.
         (b)  A tax is imposed on the importation into this state of a
  sweetened beverage for sale to the ultimate consumer.
         (c)  Except as provided by Subsection (d), the rate of the
  tax imposed by this section is one cent for each ounce or fractional
  part of an ounce of a sweetened beverage.
         (d)  On January 1 of each year, the comptroller shall
  increase the rate of the tax prescribed by Subsection (c) by a
  percentage equal to the percentage increase in the most recent
  annual revised Consumer Price Index for All Urban Consumers, as
  published by the federal Bureau of Labor Statistics of the United
  States Department of Labor.
         Sec. 163.052.  TAX IMPOSED ON SWEETENED BEVERAGE POWDER.
  (a) A tax is imposed on the sale to a retailer of sweetened beverage
  powder.
         (b)  A tax is imposed on the importation into this state of
  sweetened beverage powder for sale to the ultimate consumer.
         (c)  Except as provided by Subsection (d), the rate of tax
  imposed by this section is one cent for the greater of:
               (1)  each ounce or fractional part of an ounce of
  sweetened beverage that may be produced from the powder by
  following the manufacturer's directions; or
               (2)  each ounce or fractional part of an ounce of
  sweetened beverage actually produced by the retailer, as determined
  by the comptroller.
         (d)  On January 1 of each year, the comptroller shall
  increase the rate of the tax prescribed by Subsection (c) by a
  percentage equal to the percentage increase in the most recent
  annual revised Consumer Price Index for All Urban Consumers, as
  published by the federal Bureau of Labor Statistics of the United
  States Department of Labor.
         Sec. 163.053.  TAX IMPOSED ON SWEETENED BEVERAGE SYRUP. (a)
  A tax is imposed on the sale to a retailer of sweetened beverage
  syrup in this state.
         (b)  A tax is imposed on the importation into this state of
  sweetened beverage syrup for sale to the ultimate consumer.
         (c)  Except as provided by Subsection (d), the rate of tax
  imposed by this section is one cent for the greater of:
               (1)  each ounce or fractional part of an ounce of
  sweetened beverage that may be produced from the syrup by following
  the manufacturer's directions; or
               (2)  each ounce or fractional part of an ounce of
  sweetened beverage actually produced by the retailer, as determined
  by the comptroller.
         (d)  On January 1 of each year, the comptroller shall
  increase the rate of the tax prescribed by Subsection (c) by a
  percentage equal to the percentage increase in the most recent
  annual revised Consumer Price Index for All Urban Consumers, as
  published by the federal Bureau of Labor Statistics of the United
  States Department of Labor.
         Sec. 163.054.  EXEMPTION FROM TAX.  The tax imposed by this
  chapter does not apply to:
               (1)  sweetened beverages that:
                     (A)  the comptroller determines are unsalable; or
                     (B)  this state is prohibited from taxing under
  federal law; or
               (2)  a sale of sweetened beverages, sweetened beverage
  powder, or sweetened beverage syrup that occurs after a sale that is
  taxed under this chapter.
         Sec. 163.055.  IMPACT OF TAX.  The ultimate consumer or user
  in this state bears the impact of the tax imposed by this chapter.
  If another person pays the tax, the amount of the tax is added to the
  price to the ultimate consumer or user.
         Sec. 163.056.  PAYMENT OF TAX. (a) The manufacturer,
  distributor, wholesaler, or other person selling sweetened
  beverages, sweetened beverage syrup, or sweetened beverage powder
  in this state to a retailer or importing sweetened beverages,
  sweetened beverage syrup, or sweetened beverage powder for sale in
  this state to the ultimate consumer shall pay the tax imposed by
  this chapter.
         (b)  On or before the 25th day of each month, the person
  responsible for paying the tax shall send to the comptroller the
  amount of tax due under this chapter for the preceding month.
         Sec. 163.057.  REPORTS. On or before the 25th day of each
  month, the person responsible for paying the tax under this chapter
  shall file with the comptroller a report stating:
               (1)  the volume of sweetened beverages, sweetened
  beverage powder, and sweetened beverage syrup sold in this state to
  retailers;
               (2)  the volume of sweetened beverages, sweetened
  beverage powder, and sweetened beverage syrup imported into this
  state for sale in this state to the ultimate consumer; and
               (3)  any other information required by the comptroller.
         Sec. 163.058.  RECORDS.  (a) The person responsible for
  paying the tax under this chapter shall keep a complete record of:
               (1)  the volume of sweetened beverages, sweetened
  beverage powder, and sweetened beverage syrup sold in this state to
  retailers;
               (2)  the volume of sweetened beverages, sweetened
  beverage powder, and sweetened beverage syrup imported into this
  state for sale in this state to the ultimate consumer; and
               (3)  any other information required by the comptroller.
         (b)  A record required by this section must be kept or
  maintained for at least two years after the date the record is made.
  [Sections 163.059-163.100 reserved for expansion]
  SUBCHAPTER C. SALES PERMITS
         Sec. 163.101.  SALES PERMITS. (a) The comptroller shall
  issue to an applicant who qualifies under Section 163.102 a
  separate permit for each place of business in this state.
         (b)  The holder of a permit shall display it conspicuously in
  the place of business to which it applies.
         (c)  A permit is valid only for the person and the place of
  business to which it applies and is non-assignable.
         (d)  A permit issued under this chapter must be renewed
  annually.
         Sec. 163.102.  APPLICATION FOR PERMIT. (a) A person
  desiring to sell to a retailer in this state, or import for sale to
  the ultimate consumer in this state, sweetened beverages, sweetened
  beverage powder, or sweetened beverage syrup shall file with the
  comptroller an application for a permit for each place of business.
         (b)  The application must:
               (1)  be on a form prescribed by the comptroller;
               (2)  state the name under which the applicant transacts
  or intends to transact business;
               (3)  give the address of the place of business to which
  the permit is to apply;
               (4)  contain any other information required by the
  comptroller; and
               (5)  be signed by the applicant or a person authorized
  to act on behalf of the applicant.
  [Sections 163.103-163.150 reserved for expansion]
  SUBCHAPTER D.  PENALTIES AND OFFENSES
         Sec. 163.151.  INTEREST ON DELINQUENT TAX. A tax imposed by
  this chapter that is delinquent draws interest as provided by
  Section 111.060.
         Sec. 163.152.  PENALTY.  (a) A person who is responsible for
  paying the tax imposed by this chapter and who fails to file a
  report as required by this chapter or does not pay the tax when it is
  due forfeits to the state a penalty of 50 percent of the amount of
  the delinquent tax.
         (b)  The minimum penalty under this section is $1.
         Sec. 163.153.  CRIMINAL PENALTY.  (a) A person who violates
  this chapter commits an offense.
         (b)  An offense under this section is a Class C misdemeanor.
  [Sections 163.154-163.200 reserved for expansion]
  SUBCHAPTER E. CHILDREN'S HEALTH PROMOTION ACCOUNT
         Sec. 163.201.  ACCOUNT. (a)  The children's health
  promotion account is a separate account in the general revenue
  fund.
         (b)  The account consists of:
               (1)  the revenue from the tax imposed under this
  chapter;
               (2)  any gifts or grants received for the purposes of
  this subchapter; and
               (3)  interest earned on money in the account.
         (c)  The account is exempt from the application of Section
  403.095, Government Code.
         Sec. 163.202.  USE OF ACCOUNT. (a) Money in the account may
  be appropriated only as follows:
               (1)  80 percent to the Texas Education Agency for the
  purposes authorized by Subsection (b); and
               (2)  20 percent to the Department of State Health
  Services for the purposes authorized by Subsection (c).
         (b)  Money appropriated to the Texas Education Agency under
  this section may be used only to:
               (1)  implement and maintain coordinated school health
  programs, which may include enhancements to the basic school health
  program; or
               (2)  improve the school health environment through
  activities, which may include:
                     (A)  improving or building recreational
  facilities used for physical education and related activities at
  public elementary and secondary schools;
                     (B)  providing continuing education training for
  physical education teachers;
                     (C)  hiring qualified physical education
  teachers;
                     (D)  implementing Safe Routes to Schools
  programs;
                     (E)  improving the quality and nutrition of foods
  served at public elementary and secondary schools;
                     (F)  ensuring, at no cost, access to clean
  drinking water throughout the school day; and
                     (G)  incorporating nutrition and health into the
  standard educational curriculum.
         (c)  Money appropriated to the Department of State Health
  Services under this section may be used only to fund training and
  technical assistance for the implementation and maintenance of
  coordinated school health programs in public elementary and
  secondary schools.
         (d)  Money appropriated under this section may be used only
  to supplement and not to supplant current federal, state, and local
  funding for children's health programs in public elementary and
  secondary schools.
         SECTION 2.  Chapter 163, Tax Code, as added by this Act,
  applies to a sweetened beverage, sweetened beverage powder, or
  sweetened beverage syrup sold or imported on or after the effective
  date of this Act. A sweetened beverage, sweetened beverage powder,
  or sweetened beverage syrup sold or imported before that date is
  governed by the law in effect when the sweetened beverage,
  sweetened beverage powder, or sweetened beverage syrup was sold or
  imported, and that law is continued in effect for that purpose.
         SECTION 3.  This Act takes effect September 1, 2011.