- Special Sections
- Top Homes
- Local Guide
The Big Spring City Council pledged its intent to continue to tax inventories considered to be in transit during its meeting Tuesday night, reaffirming the similar decision made by the council in 2007.
According to state officials, the Texas legislature recently amended the goods-in-transit tax law to require taxing entities to decide whether or not they want to offer the exemption. Now, a taxing entity must decide whether to allow goods in transit to be taxed or not.
Goods in transit is defined in the Texas Tax Code, Chapter 11.253, as those items that are brought in for holding until they are shipped elsewhere for production. Also, the goods cannot remain at the same location for more than 175 days before they are shipped on.
“There has been what's called the Super Freeport legislation on the books for many years, which, through the federal government, allowed the exemption from taxation for manufacturing processes and inventory,” City Finance Director Peggy Walker said. “In 2007, the city council passed a resolution declaring our intent to tax those which are now called goods in transit. During the last legislative session, the legislature actually narrowed that exemption. They took away some of the exemptions to make Texas more compatible and competitive with other states, specifically New Mexico, for various reasons. So there isn't as much impact on our possible tax base as there has been in the past.”
For more information, you may subscribe to the Big Spring Herald or purchase an e-edition.