| (a) Natural gas and electricity: imposition of the tax.
(1) The local tax applies to sales of natural gas and electricity
for use in a city that has adopted the local tax and must be collected for
the city in which delivery is made to the consumer.
(2) When a city adopts the local tax, the tax does not
apply to sales of natural gas and electricity during a customer's regular
monthly billing period that begins before the effective date of the adoption
of the tax. The tax shall apply to each regular monthly billing period beginning
on or after the effective date of the tax.
(b) Natural gas and electricity: exemptions from tax.
(1) Certain uses of natural gas and electricity are exempt
from local tax. See §3.295 of this title (relating to Natural Gas and
Electricity) for a discussion of definitions, specific exemptions relating
to the sale or use of natural gas and electricity, and the circumstances under
which the predominant use theory may be applied. Residential use of natural
gas and electricity in a city is exempt unless the tax is imposed by a city
as provided in paragraph (2) of this subsection.
(2) Residential use of natural gas and electricity.
(A) Effective October 1, 1979, the sale of natural gas and
electricity for residential use is exempt from taxation under the Local Sales
and Use Tax Act unless:
(i) the city voted for early abolition (see subparagraph (B)
of this paragraph);
(ii) the city voted to continue taxation (see subparagraph
(C) of this paragraph); or
(iii) the city voted to reimpose tax (see subparagraph (D)
of this paragraph).
(B) Early abolition. At any time before October 1, 1979, by
a majority vote of the membership of the governing body of a city, the governing
body could exempt from the local tax the sale of natural gas and electricity
for residential use. After the results of the vote were entered into the minutes
of the city, the city secretary must have forwarded to the comptroller by
registered or certified mail a certified copy of the ordinance. On receipt
of notification, one whole calendar quarter must have elapsed prior to the
exemption becoming effective (see §3.372(d)(1) of this title (relating
to Adoption or Abolition City Tax) for an illustration of this procedure)
unless notification was received by the comptroller by registered or certified
mail postmarked no later than September 10, 1978; in which case, the exemption
was effective on October 1, 1978.
(C) Continue taxation. If the governing body of a city wished
to continue to impose the local tax on the sale of natural gas and electricity
for residential use, the city secretary must have forwarded to the comptroller's
office before May 1, 1979, by registered or certified mail a certified copy
of the ordinance reflecting the majority vote of the membership exempting
natural gas and electricity. If the ordinance was not received by the comptroller
before May 1, 1979, the exemption from the local tax automatically became
effective on October 1, 1979. To continue the taxation of residential use,
the city secretary must have forwarded to the comptroller's office before
June 30, 1979, by registered or certified mail, a certified copy of the ordinance
reflecting the majority vote of the membership reimposing tax on natural gas
and electricity.
(D) Reimposition of tax authorized. The local tax may be reimposed
by a majority vote of the membership of the governing body of a city that
exempted residential use of natural gas and electricity before May 1, 1979.
If the majority of the governing body votes for the reimposition of the local
tax, the results of the vote must be entered in the minutes of the city. Thereafter,
the city secretary must forward to the comptroller by registered or certified
mail a certified copy of the ordinance reimposing the tax. Upon receipt of
notification by the comptroller, there shall elapse one whole calendar quarter
prior to the reimposition becoming effective. The reimposition shall take
effect beginning on the first day of the calendar quarter next succeeding
the elapsed quarter.
(E) Effect of billing periods. The exemption or reimposition
of the local tax does not apply to sales of natural gas and electricity for
residential use made during a customer's regular monthly billing period which
begins before the effective date of the exemption or reimposition. The exemption
or reimposition shall apply to each regular monthly billing period beginning
on or after the effective date of the exemption or reimposition.
(F) Cities adopting the Local Sales and Use Tax Act. Cities
that first adopt the local sales and use tax after October 1, 1979, may not
impose the tax on the residential use of natural gas and electricity.
(G) The sale of natural gas and electricity for residential
use is automatically exempt from the additional city tax imposed under the
Tax Code, §321.101(b) or the Development Corporation Act of 1979 (Texas
Civil Statutes, Art. 5190.6), if the sale of natural gas and electricity is
exempt from tax under §321.101(a). The sale of natural gas and electricity
for residential use is automatically taxed under Tax Code, §321.101(b)
if the tax under Tax Code, §321.101(a) is imposed on the sale of natural
gas and electricity for residential use.
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| Source Note: The provisions of this §3.378 adopted to be effective January 1, 1976; amended to be effective October 25, 1978, 3 TexReg 3571; amended to be effective March 7, 1979, 4 TexReg 554; amended to be effective November 24, 1987, 12 TexReg 4198; amended to be effective August 15, 2000, 25 TexReg 7774 |
