Goods-in-Transit Legislation Requires Resolution
Under the provisions of Senate Bill 1, Special Called Session, a new property tax exemption will be granted to “goods-in-transit” unless each taxing entity, including counties, adopts a resolution by December 31, 2011, to continue taxation of this property. “Goods-in-transit” means tangible personal property acquired or imported into Texas to be forwarded to another location in Texas or outside Texas not later than 175 days after the acquisition in or importation into Texas. “Goods-in-transit” includes only those goods stored under a contract of bailment by a public warehouse operator. While there is some overlap between the new “goods-in-transit” exemption and the “freeport” exemption for goods to be forwarded out of Texas, separate action is now required to prevent this new automatic exemption for stored goods.
Adoption of the below resolution will prevent this automatic exemption and preserve the option for future consideration by the Commissioners Court. Please note that a public hearing must be conducted before adoption of the resolution. In an abundance of caution, the county may consider publishing a notice of the public hearing.
RESOLUTION TO CONTINUE TAXATION
WHEREAS, on October 1, 2011, a legislative change to Section 11.253 of the Texas Tax Code (which provides a general exemption from property taxation for certain goods-in-transit personal property) takes effect and nullifies all previous local option actions taken by a Commissioners Court to provide for the taxation of goods-in-transit; and
WHEREAS, the new statute also provides a local option for Commissioners Court to opt out of the exemption provided it takes official action to tax the goods-in-transit after October 1, 2011 and before January 1 of the first tax year in which the Commissioners Court proposes to tax goods-in-transit; and
WHEREAS, the County Commissioners Court held a public hearing on the issue of taxing goods-in-transit on , 2011; and
WHEREAS, the County Commissioners Court finds that the goods-in-transit exemption as authorized by Section 11.253 of the Texas Tax Code is not in the best interest of County and further finds that more appropriate business incentives exist to encourage economic development and growth of business in County;
NOW, THEREFORE, BE IT RESOLVED THAT THE COMMISSIONERS COURT OF COUNTY, TEXAS, as permitted by the Texas Constitution and Section 11.253 of the Texas Tax Code, hereby provides for the taxation of goods-in-transit otherwise exempt from taxation by Section 11.253 of the Texas Tax Code.
Duly adopted by vote of the Commissioners Court of County, Texas on the day of , 2011.
For more information, please call me at 1-800-733-0699.