On June 10, 2011, the Texas House passed with amendments S1, the Senate omnibus fiscal matters bill, which contains myriad tax provisions including the sales tax provision which provides that online subsidiaries or affiliates of retailers with stores or other facilities in Texas have nexus with the state. In a June 9 press release, Texas Governor Rick Perry called on the state legislature to review the nexus issue further before changing Texas tax policy, and urged the legislature to remove the Internet sales tax language from the bill. Governor Perry vetoed H2403 containing identical nexus provisions on May 31, 2011. (L. 2011 S1 (1st S.S.); Statement by Gov. Rick Perry on Internet Sales Tax Language in Fiscal Matters Bill, 06/09/2011.)

On May 31, 2011, Texas Governor Rick Perry vetoed H2403, proposed legislation which provided that online subsidiaries or affiliates of retailers with stores or other facilities in Texas would have nexus with the state.

Governor Perry said that he had serious concerns about the impact and appropriateness of the bill, believing that it risked significant unintended consequences. The governor stated that his preference is to conduct a thorough policy discussion with Texas lawmakers, consumers, retailers and technology experts, as well as with other states and the federal government, about interstate commerce and the structure of sales taxes in the 21st century, and reach a consensus that balances competing interests, respects federalism, and is fair and equitable.