HB 2825

Telecom Tax Cut Waits Until 2028, Refund Ends In 2027

Did not pass

Verdict: Smells

SmellsInitial review

Rep. Tom CraddickRHouse 82

Both charges, and why

Pitch: Corporate welfare

ACTUALLY

…“consumption of tangible personal property is four percent if:”

Bill text, House committee report version (H)

The bill gives cable, internet and telecom providers a lower state sales tax rate on their network equipment that other businesses do not get.

Pitch: Corporate welfare

Delayed start

THE TEXT

“Effective January 1, 2028, Subchapter H, Chapter”…

Bill text, House committee report version (H)

The tax cut itself does not begin until January 1, 2028, well after the November 3, 2026 election and more than two years after the session. The existing refund is repealed a year earlier, on January 1, 2027.

Delayed start

Initial review · graded Oct 22, 2026 · Headline, summary and grade are analysis of the bill text, not a finding about any person · How we grade

Caption

relating to sales and use tax rates and refunds for certain tangible personal property used to provide cable television services, Internet access services, or telecommunications services; reducing the rate of the state sales and use tax applicable to certain taxable items.

Caption from analyzed text · version H.

Summary

The committee analysis says it seeks to “create jobs.” First, a year with neither benefit!

The bill cuts the state sales tax rate from the normal rate to four percent on equipment that cable, internet and telephone companies buy and use directly to run their networks, and it repeals the current program that refunds part of the sales tax on that equipment. It touches cable TV, internet access and telecom providers and their subsidiaries, while equipment used for data processing or information services gets no cut and local sales taxes are left alone. The refund program ends January 1, 2027, but the lower rate does not start until January 1, 2028, so providers face a year with neither benefit except for refunds already earned and claimed by March 31, 2027.

Labels

Labels: ACROSS THE AISLE. Joint authors: 1 Republican, 1 Democrat. Party as the Legislative Reference Library lists it for the 89th Legislature.STALLED AFTER COMMITTEE. Voted out of the House Ways & Means committee 12-1 on May 7, 2025. Never placed on a calendar. The bill died.

Receipt

The receipt

89R-HB2825 · 2025-02-13

SOLD BY

Rep. Tom CraddickRHouse 82

Rep. Armando "Mando" MartinezDHouse 39

ITEM

WHAT IT DOES

The committee analysis says it seeks to “create jobs.” First, a year with neither benefit!

CHARGES

[x] PITCH: CORPORATE WELFARE

ACTUALLY

…“consumption of tangible personal property is four percent if:”

Bill text, House committee report version (H)

The bill gives cable, internet and telecom providers a lower state sales tax rate on their network equipment that other businesses do not get.

[x] DELAYED STARTanalysis confidence 80%

THE TEXT

“Effective January 1, 2028, Subchapter H, Chapter”…

Bill text, House committee report version (H)

TOTAL

Net to General Revenue · FY 2026$0

LBB estimate, flow · fiscal note version H · ( ) = negative · source

Sources

Fiscal note · version H · May 10, 2025

Estimated Two-year Net Impact to General Revenue Related Funds for HB2825, Committee Report 1st House, Substituted: an impact of $0 through the biennium ending August 31, 2027. However, there would be an impact of ($17,260,000) through the biennium ending August 31, 2029.

First year · FY 2026 · $0

Probable Net Positive/(Negative) Impact to General Revenue Related Funds

LBB published estimates · flow over the stated periods.

Source snapshot 2026-10-19, Central time.

HISTORY

Feb 13, 2025Filed
Mar 19, 2025Read first time
Mar 19, 2025Referred to Ways & Means
Apr 21, 2025Scheduled for public hearing on . . .
Apr 21, 2025Considered in public hearing
Apr 21, 2025Committee substitute considered in committee
Apr 21, 2025Testimony taken/registration(s) recorded in committee
Apr 21, 2025Left pending in committee
May 7, 2025Considered in formal meeting
May 7, 2025Committee substitute considered in committee
May 7, 2025Reported favorably as substituted
May 13, 2025Comte report filed with Committee Coordinator
May 13, 2025Committee report distributed
May 14, 2025Committee report sent to Calendars

FILED UNDER

CORPORATE WELFARE

THE TEXT

…“consumption of tangible personal property is four percent if:”

Bill text, House committee report version (H)

The bill gives cable, internet and telecom providers a lower state sales tax rate on their network equipment that other businesses do not get.

Smells

THANK YOU FOR CHECKING THE RECEIPT

CAMPAIGN PAID FOR BY

Tom Craddick

Donors

Associated General Contractors of Texas PAC$101K Texans for Lawsuit Reform PAC$70KJohn R. Weisman$30,000

Not tied to this bill.

Sources

The author's campaign account only. Own money and internal transfers are separate on the member page.

Derived itemized flow · Oct 29, 2024 to Oct 22, 2026. State data as of Nov 4, 2026.

Derived itemized contributions on live regular reports and uncovered special-session dates. Internal account transfers and daily reports are excluded.

Associated General Contractors of Texas PAC$100,500.00

Associated General Contractors of Texas PAC

$100,500.00

Cash: $100,500.00
Paid by others: $0.00
Total: $100,500.00

Also funds 120 other sitting lawmakers.

Derived recipient stock · Jul 19, 2024 to Oct 23, 2026. State data as of Nov 4, 2026.

TEC account match.

Team

Sources

Derived itemized flow · Sep 18, 2025 to May 21, 2026. State data as of Nov 4, 2026.

Derived itemized contributions on live regular reports and uncovered special-session dates. Internal account transfers and daily reports are excluded.

Report IDs: 101028957, 101058926.

Texans for Lawsuit Reform PAC$70,000.00

Texans for Lawsuit Reform PAC

$70,000.00

Cash: $70,000.00
Paid by others: $0.00
Total: $70,000.00

Also funds 124 other sitting lawmakers.

Derived recipient stock · Jul 10, 2024 to Oct 23, 2026. State data as of Nov 4, 2026.

TEC account match.

Team

Sources

Derived itemized flow · Oct 29, 2024 to Oct 1, 2026. State data as of Nov 4, 2026.

Derived itemized contributions on live regular reports and uncovered special-session dates. Internal account transfers and daily reports are excluded.

Report IDs: 100986335, 101009831, 101028957, 101071728.

John R. Weisman$30,000.00

Money

Missing data does not establish zero giving. Display amounts are rounded.

Associated General Contractors of Texas PAC

$100,500.00

Cash: $100,500.00
Paid by others: $0.00
Total: $100,500.00

Also funds 120 other sitting lawmakers.

Derived recipient stock · Jul 19, 2024 to Oct 23, 2026. State data as of Nov 4, 2026.

TEC account match.

Team

Sources

Derived itemized flow · Sep 18, 2025 to May 21, 2026. State data as of Nov 4, 2026.

Derived itemized contributions on live regular reports and uncovered special-session dates. Internal account transfers and daily reports are excluded.

Report IDs: 101028957, 101058926.

Texans for Lawsuit Reform PAC

$70,000.00

Cash: $70,000.00
Paid by others: $0.00
Total: $70,000.00

Also funds 124 other sitting lawmakers.

Derived recipient stock · Jul 10, 2024 to Oct 23, 2026. State data as of Nov 4, 2026.

TEC account match.

Team

Sources

Derived itemized flow · Oct 29, 2024 to Oct 1, 2026. State data as of Nov 4, 2026.

Derived itemized contributions on live regular reports and uncovered special-session dates. Internal account transfers and daily reports are excluded.

Report IDs: 100986335, 101009831, 101028957, 101071728.

Votes

No floor vote loaded for this bill.

Witnesses21

For: 19
Against: 1
On: 1

Names

For

AT&T2 registrations
Charter Communications1 registration
Comcast1 registration
Dallas Regional Chamber1 registration
El Paso County1 registration
Greater Houston Partnership1 registration
North Texas Commission1 registration
Self; AT&T1 registration
T-Mobile2 registrations
Texas Association of Business1 registration
Texas Broadband Associarion1 registration
Texas Cable Association1 registration
Texas e-Health Alliance1 registration
Texas Rural Broadband Association1 registration
Texas Telephone Association1 registration
Verizon2 registrations

Against

City of Dallas1 registration

On

Comptrollers office1 registration

Sources

21 parsed registrations across the loaded witness lists.

Derived stock of witness registrations. Repeated appearances count separately. Organizations and self-representation appear as printed.

House witness list. Source snapshot 2026-10-20, Central time.

Fiscal

Net to General Revenue · FY 2026$0

LBB estimate, flow · fiscal note version H · ( ) = negative · source

Sources

Fiscal note · version H · May 10, 2025

First year · FY 2026 · $0

Probable Net Positive/(Negative) Impact to General Revenue Related Funds

LBB published estimates · flow over the stated periods.

Source snapshot 2026-10-19, Central time.

How this was graded

Analysis of text version H by claude-opus-5-5, Oct 22, 2026, against the published rubric.

Sources

Texas House · Filed Feb 13, 2025

05/14/2025 H Committee report sent to Calendars

Texas Legislature Online · Introduced · House Committee Report

Data snapshot Oct 26, 2026 at 4:19 AM CDT. Grades, charges, quotes and corrections follow the published record.

House committee · Ways & Means · Committee vote 12 aye, 1 nay · Out of committee

Companion

SB 1217 by Hughes (identical)

Subjects

Property Interests--Personal Property

Taxation--Sales

Utilities--Telecommunications

INTERNET

TELEVISION

COMPTROLLER OF PUBLIC ACCOUNTS

Text

The text as introduced · 402 words

89R13559 CJD-D

By: Craddick
H.B. No. 2825

A BILL TO BE ENTITLED

AN ACT

relating to sales and use tax exemptions and refunds for certain

tangible personal property used to provide cable television

services, Internet access services, or telecommunications

services.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Subchapter H, Chapter 151, Tax Code, is amended

by adding Section 151.3187 to read as follows:

Sec. 151.3187. PROPERTY USED IN CABLE TELEVISION, INTERNET

ACCESS, OR TELECOMMUNICATIONS SERVICES. (a) In this section,

"provider" means a provider of cable television service, Internet

access service, or telecommunications services.

(b) Except as provided by Subsection (c), the sale, lease,

or rental or storage, use, or other consumption of tangible

personal property is exempted from the taxes imposed by this

chapter if:

(1) the property is sold, leased, or rented to or

stored, used, or consumed by a provider or a subsidiary of a

provider; and

(2) the property is directly used or consumed by the

provider or subsidiary described by Subdivision (1) in or during:

(A) the distribution of cable television

service;

(B) the provision of Internet access service; or

(C) the transmission, conveyance, routing, or

reception of telecommunications services.

(c) The exemption provided by this section does not apply

to:

(1) the sale, lease, or rental or storage, use, or

other consumption of tangible personal property directly used or

consumed in or during the provision, creation, or production of a

data processing service or information service; or

(2) a tax authorized or imposed under Subtitle C,

Title 3.

SECTION 2. Section 151.3186, Tax Code, is repealed.

SECTION 3. (a) The repeal of Section 151.3186, Tax Code, by

this Act does not affect a refund for which a taxpayer:

(1) became entitled to the refund before the effective

date of this Act; and

(2) timely filed a claim for the refund with the

comptroller of public accounts on or before March 31, 2026.

(b) Except as provided by Subsection (a) of this section,

the change in law made by this Act does not affect tax liability

accruing before the effective date of this Act. That liability

continues in effect as if this Act had not been enacted, and the

former law is continued in effect for the collection of taxes due

and for civil and criminal enforcement of the liability for those

taxes.

SECTION 4. This Act takes effect January 1, 2026.