HBA-AMW C.S.H.B. 3382 77(R)BILL ANALYSIS Office of House Bill AnalysisC.S.H.B. 3382 By: Davis, Yvonne Ways & Means 4/20/2001 Committee Report (Substituted) BACKGROUND AND PURPOSE Most excise tax rates, such as the rates on alcohol, are determined by volume or weight; however, taxes on smokeless tobacco are based on the manufacturer's list price. Currently, certain types of smokeless tobacco are considered premium products and have a higher manufacturer's list price. The quality of premium and non-premium tobacco products is essentially comparable. However, premium smokeless tobacco producers are required to remit a higher tax to the comptroller of public accounts. C.S.H.B. 3382 modifies the standards by which taxes are assessed for smokeless tobacco products. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that this bill does not expressly delegate any additional rulemaking authority to a state officer, department, agency, or institution. ANALYSIS C.S.H.B. 3382 amends the Tax Code to establish the tax rate for each can or package of moist snuff, dry snuff, chewing tobacco, pipe tobacco, and roll-your-own tobacco and to provide requirements for computing the total tax for these products. The bill requires that an ambiguity regarding the proper classification of a tobacco product for taxation purposes to be resolved by reference to the classification of the tobacco product for federal tobacco tax purposes (Sec. 155.0211). The bill provides that records of purchase or receipt, distributor and wholesaler reports of sale or use, manufacturer's records and reports, and distributor's reports required to be filed with the comptroller of public accounts must show the net weight as listed by the manufacturer for each unit and the aggregate net weight of moist snuff, dry snuff, chewing tobacco, pipe tobacco, and roll-your-own tobacco listed on each invoice (Secs. 155.101-155.103, 155.111). EFFECTIVE DATE September 1, 2001. COMPARISON OF ORIGINAL TO SUBSTITUTE C.S.H.B. 3382 modifies the original bill by increasing from 58 to 72 cents per ounce the tax rate for each can or package of moist snuff, from 33 to 46 cents per ounce the tax rate for each can or package of dry snuff, and from 16 to 23 cents per ounce the tax rate for each can or package of chewing tobacco. The substitute also modifies the original bill by increasing from 42 to 58 cents per ounce the tax rate for each can or package of pipe tobacco and from 39 to 54 cents per ounce the tax rate for each can or package of roll-your-own tobacco (Sec. 155.0211, Tax Code).