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Texas Wary of Taxman

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By Glen Fest





DALLAS--Ad industry officials have raised concerns with Texas legislators that a $5.7 billion property tax reform bill could inadvertently impose taxes on marketing planning and research, despite a House committee's earlier move to retain advertising services' tax exemption.





The Texas Council of Advertising and Magazine Publishing (TCAMP) said it will wait until the massive tax package reaches the Senate before seeking clarification.





'(The legislators) do not intend to tax advertising,' said TCAMP legislative consultant Karol Rice. 'They've made that perfectly clear.'





The legislature is working on a plan to shift the tax onus of public education financing from property owners to businesses and consumers. The House is expected to vote on the bill this week.





TCAMP accepted a House committee's decision three weeks ago to tax management consultant and public relations services. (It is still fighting a proposed magazine subscription sales tax.) When the bill came back in draft form, the definitions for consulting and pr services--actually aimed at lobbyists rather than marketers--drew a red flag from TCAMP.





Among services defined under the section as taxable were 'business strategies and marketing objectives and policies,' plus those 'relating to gathering or compiling economic, sociological, consumer, or other information.'





Former regional American Advertising Federation chairman Jim Goodnight of Dallas and TCAMP are proposing an amendment for Senate adoption that would clearly exempt 'marketing and advertising services provided in the promotion of commercial products.'





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