By State Representative Michelle Beckley
•
06 Jul, 2021
The city council of Carrollton, Texas provided comments regarding House Bill 4072 , which was proposed during the 87th Texas Legislative Session. The city council of Carrollton, Texas expressed their opposition for HB 4072 . HB 4072 sought to simplify and clarify local sales and use tax administration by establishing as the state’s default sourcing method a destination-based method under which sales are sourced to the location where the item is shipped or delivered or where the purchaser takes possession. HB 4072 requires that local sales taxes be collected and reported based on an item’s final destination as opposed to the transaction location. The city council of Carrollton voiced that the proposed changes would have disproportionally impacted cities with large commercial bases, placed undue burden on businesses, and caused unintended consequences. Our office also reviewed the potential impact of HB 4072 on the City of Lewisville. If HB 4072 had been passed, the changes would have resulted in an annual loss of more than $10 million in sales tax for Lewisville. Lewisville would have likely faced reduced services and employee layoffs across all city departments, including police and fire departments. The Office of State Representative Beckley proudly represented the interests of Carrollton and Lewisville, by opposing this piece of legislation. HB 4072 intended to address a perceived inequity that results from the misuse of Chapter 380 agreements, but the Comptroller already has the authority to invalidate these types of agreements. Cities use Chapter 380 agreements to grow their economies and benefit their communities. HB 4072 was unsuccessful during the 87th Legislative Regular Session; it was voted out of the Ways & Means House Committee but did not make its way to the House Floor. HB 4072 was left pending in the Calendars Committee; the Calendars Committee has jurisdiction over the placement of bills and resolutions on appropriate calendars. The 87th Regular Session ended on May 31, 2021. Sincerely, State Representative Michelle Beckley