SUBCHAPTER E. SALES AND USE TAX TO LOWER AD VALOREM TAXES

Sec. 285.061. TAX AUTHORIZED; TAX RATES. (a) A hospital district that is authorized to impose ad valorem taxes may adopt a sales and use tax to lower the district's ad valorem taxes at an election held as provided by this subchapter. A district may change the rate of the sales and use tax or abolish the sales and use tax at an election held as provided by this subchapter. Subject to the limitations provided by Subsections (c) and (d), the district may impose the tax in increments of one-eighth of one percent, with a minimum tax of one-eighth of one percent and a maximum tax of two percent.

(b) Chapter 323, Tax Code, applies to the application, collection, and administration of the tax imposed under this subchapter. The comptroller may make rules for the collection and administration of this tax in the same manner as for a tax imposed under Chapter 323, Tax Code. Where a county and a hospital district both impose a sales and use tax, the comptroller may by rule provide for proportionate allocation of sales and use tax collections between a county and a hospital district on the basis of the period of time each tax is imposed and the relative tax rates.

(c) A district may not adopt a tax under this subchapter or increase the rate of the tax if as a result of the adoption of the tax or the tax increase the combined rate of all sales and use taxes imposed by the district and other political subdivisions of this state having territory in the district would exceed two percent at any location in the district.

(d) If the voters of a district approve the adoption of the tax or an increase in the tax rate at an election held on the same election date on which another political subdivision of this state adopts a sales and use tax or approves the increase in the rate of its sales and use tax and as a result the combined rate of all sales and use taxes imposed by the district and other political subdivisions of this state having territory in the district would exceed two percent at any location in the district, the election to adopt a sales and use tax or to increase the rate of the sales and use tax in the district under this subchapter has no effect.

(e) to (h) Expired.

Added by Acts 1989, 71st Leg., 1st C.S., c. 40, Sec. 1, eff. Sept. 1, 1989. Amended by Acts 1991, 72nd Leg., ch. 658, Sec. 1, eff. June 16, 1991; Acts 1997, 75th Leg., ch. 158, Sec. 1, eff. May 20, 1997; Acts 2001, 77th Leg., ch. 1290, Sec. 2, eff. Sept. 1, 2001.