By: Nelson, et al. S.B. No. 7
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to the computation of and to decreasing the rates of the
  franchise tax.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  (a)  TITLE.  This Act shall be known as the
  Franchise Tax Repeal Act of 2015.
         (b)  PURPOSE AND FINDINGS.  The legislature finds that the
  tax imposed by Texas Tax Code Chapter 171 has not provided
  sufficient reliability for property tax relief.  It is the intent of
  the legislature to promote economic growth by repealing the
  franchise tax.
         SECTION 2.  Sections 171.002(a) and (b), Tax Code, are
  amended to read as follows:
         (a)  Subject to Sections 171.003 and 171.1016 and except as
  provided by Subsection (b), the rate of the franchise tax is 0.85
  [one] percent of taxable margin.
         (b)  Subject to Sections 171.003 and 171.1016, the rate of
  the franchise tax is 0.425 [0.5] percent of taxable margin for those
  taxable entities primarily engaged in retail or wholesale trade.
         SECTION 3.  Sections 171.1016(a) and (b), Tax Code, are
  amended to read as follows:
         (a)  Notwithstanding any other provision of this chapter, a
  taxable entity whose total revenue from its entire business is not
  more than $20 [$10] million may elect to pay the tax imposed under
  this chapter in the amount computed and at the rate provided by this
  section rather than in the amount computed and at the tax rate
  provided by Section 171.002.
         (b)  The amount of the tax for which a taxable entity that
  elects to pay the tax as provided by this section is liable is
  computed by:
               (1)  determining the taxable entity's total revenue
  from its entire business, as determined under Section 171.1011;
               (2)  apportioning the amount computed under
  Subdivision (1) to this state, as provided by Section 171.106, to
  determine the taxable entity's apportioned total revenue; and
               (3)  multiplying the amount computed under Subdivision
  (2) by the rate of 0.331 [0.575] percent.
         SECTION 4.  This Act applies only to a report originally due
  on or after the effective date of this Act.
         SECTION 5.  The comptroller of public accounts shall conduct
  a comprehensive study, no later than September 30th, 2016, to
  identify the effects of economic growth on future state revenues.  
  The results of the study shall be reported to the governor and the
  Legislative Budget Board.  The report should identify revenue
  growth allocation options to promote efficiency and sustainability
  in meeting the revenue needs of this state, including revenues
  allocated by Tax Code 171.4011, upon repeal of the franchise tax.
         SECTION 6.  This Act takes effect January 1, 2016.