Texas Local Government Code 501.161 – Certain Economic Incentives Prohibited
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(a) In this section, “related party” means a person who owns at least 80 percent of the business enterprise to which the sales and use tax would be rebated as part of an economic incentive.
(b) Notwithstanding any other provision of this subtitle, a corporation may not offer to provide an economic incentive for a business enterprise whose business consists primarily of purchasing taxable items using a resale certificate and then reselling those items to a related party.
Terms Used In Texas Local Government Code 501.161
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- Person: includes corporation, organization, government or governmental subdivision or agency, business trust, estate, trust, partnership, association, and any other legal entity. See Texas Government Code 311.005