Any city located in a county with a population of less than 500,000 may impose a Type A tax if the new combined local sales tax rate would not exceed 2 percent. Some cities located in counties with a population of 500,000 or more (Bexar, Dallas, El Paso, Harris, Hidalgo, Tarrant and Travis) may also use Type A for economic development efforts but a city's eligibility varies from county to county. For information on which cities are eligible in these counties, call the Comptroller's Local Government Assistance section at (800) 531-5441, ext. 3-4679.
All cities are eligible to adopt the Type B sales tax if the combined local sales tax rate would not exceed 2 percent.
This information should not be construed as, and is not a substitute for, legal advice.
Cities are urged to consult the Attorney General's Economic Development Handbook and their own legal counsel for any questions or interpretations of economic development laws.