House Bill 32 (84(R) HB32) known as the Franchise Tax Reduction Act of 2015 was signed by Governor Abbot on June 16, 2015. Essentially, HB32 decreases the franchise tax rate from 1 percent to 0.75 percent. The bill also decreases the franchise tax on retailers or wholesalers from 0.5 percent to 0.375 percent. A taxable entity with no more than $20 million in total revenue, up from $10 million in current law, can choose to pay the franchise tax under E-Z computation and rate provisions. The bill will decrease the tax rate under this computation from 0.575 percent to 0.331 percent. The bill takes effect January 1, 2016, and will apply only to a franchise tax report originally due on or after that date.
Doing business in Texas just gets better and better! Thank you to our friends as Karlins Ramey & Tompkins LLC for this synopsis of the bill.
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