Texas legislators reverse anti-tax stance, debate several new fees

[question everything]

AUSTIN, Texas – A year ago, the mantra echoing through the Texas Capitol was: No new taxes. No way, no how. Now, the state's Republican governor and legislative leaders are debating new taxes on businesses, cars, bottled water, newspapers, billboards and pro sports tickets. They're contemplating raising the sales tax, legalizing and taxing video slot machines and increasing the cigarette tax.

Behind their change of heart: demands to increase school funding, cut property taxes and replace an unpopular share-the-wealth funding system that sends property tax money from wealthy school districts to less-affluent ones.

(snip)

Legislatures and courts across the country have struggled for decades to find ways to provide an equal education in the face of big inequities in the local tax revenue that funds schools in many states. Often that has meant contemplating higher taxes, something that is particularly painful for Texas Republicans, who gained control of both chambers of the Legislature last year for the first time since Reconstruction.

Republican Gov. Rick Perry threw the issue to lawmakers in a 30-day special session that ends Wednesday. Lt. Gov. David Dewhurst said yesterday that state senators won't approve a plan by then, meaning another session is likely. The Legislature faces a deadline of sorts to tackle the issue. A trial is set to begin Aug. 9 in a lawsuit by school districts challenging the funding system – the state's third major education funding lawsuit in the past 25 years.

Perry contends that imposing new taxes this year would actually be a tax "shift" to replace property taxes with other money. He says he is open to all options that do not hurt businesses and stifle job creation.

(snip)


Find this article at:
http://www.signonsandiego.com/uniontrib/20040515/news_1n15texas.html

[aquart]

1. Shifting the burden off the rich?

[tkulesa]

2. Of course they are

The sales tax, cigarette tax, video slots and many of the others that they will implement will be regressive taxes that hurt the poor more than the rich.

Of course one of the taxes they won't consider will be an increase in income tax rates.

And there is no way in hell they would increase taxes on unearned income.

The rich don't pay taxes like the poor, not at the federal level and not at the state level.

[TheFarseer]

5. there's no income tax in TX

I'm not sure whether this is good or bad. Of course I don't want to pay it, but I wonder what else is higher because of a lack of an income tax and whether it ends up helping or hurting me. Conservatives want to point to sales tax as a fair tax. That is an absolute joke! Income tax is annoying to see come out of your check, but it's the most fair tax ever devised. You make money, you pay. You don't have any money, you don't pay. What's so hard about that?

[Mithras61]

10. I think there's a franchise tax...

that works as an income tax on executive officers of corporations. They've already played around with doing away with that and instituting an income tax, but that idea was junked after they discovered a little piece of Texas history (called a constitution) that would have made it appear on a statewide ballot (and you know how THAT would fare).

I like the headline on this article: http://www.statesman.com/news/content/shared/tx/legislature/05/15senate.html

78th LEGISLATURE, SPECIAL SESSION
Special session won't yield new finance law
Dewhurst says Senate needs more time to reach agreement

By Ben Wear and
AMERICAN-STATESMAN STAFF
Saturday, May 15, 2004


The governor didn't want new business taxes. The House didn't want slot machines. And the Senate didn't want to vote on a dead-end bill that would raise taxes.

<snip>

[TexasBushwhacker]

11. As a Texas bookkeeper ....

the franchise tax is on a business, not on the the executive officers. It's based on the gross sales of the business and frankly, it's not that high. The people that bitched about it the most were C-Corps, which are usually sole proprieters. They have to treat the companies income as personal income, at personal income tax rates. If they're big enough, the smart thing to do is go ahead and incorporate as an S-Corp. A franchise tax for businesses is still better than a state income tax, IMHO.

[Mithras61]

13. Thanks for that clarification of the law.

I hate talking about taxes & tax rates when I have relied solely on the newspapers as a source...

Edited for speellinngg...

[stilpist]

8. Tax private school tuition payments instead of cigarettes.

Or how 'bout a 10% sales tax on motor vehicle purchases with a $20K exemption.

Wasn't it Willie Sutton that said he robbed banks 'cause that's where the money was? Get it from them that's got it.

Let's get progressive here!

- stil

[TexasBushwhacker]

12. It will never happen

We don't even get state tax credits for driving zero emmission vehicles. We don't have E10 (gasohol) and we sure as hell don't have e85. They want us to keep buying those big gas guzzlers. To hell with the environment!

[TheFarseer]

3. I'm so glad someone brought this up

I'm just furious that they want to cut property taxes and increase sales tax(by a staggering 1% as I've heard it) They're trying to sell this as business will move in if property taxes are lower. Give me a break! They are shifting tax burden to everyone that buys things, including homeless people, people who are barely making rent and others like that. How regressive can a tax be? If you are not a homeowner and you vote republican I think you have got to be mentally deficient and even if you are a homeowner you're nearsighted and wearing blinders. Can't you see this is totally unfair and it's going to probably end up costing you more money! and btw - I think states that don't have gambling are absolutely stupid.

[salin]

4. but won't business be hurt by an increase in the sales tax

using their own logic... if goods cost less, people will consume less which will hurt businesses... folks out to write letters to the editor to this point... true or not - it is the type of rationale the GOP has been using forever... suddenly the repub readers will be faced with the argument that resonates with them being used against their beloved gopers...

[TheFarseer]

6. yep, you could drive a truck through

the hole in that arguement. You *could* argue that a sales tax increase won't stop people from buying what they were already going to buy but on the other hand it's entirely conceivable that people close to the border will buy stuff in neighboring states to avoid sales tax. It's the same with bush's tax cuts - he wanted to cut taxes because the economy was doing good, then he wanted to cut taxes because it was doing bad. It's VERY obvious they just want to cut taxes on the rich. It's hard to believe people can't see through this.

[salin]

14. sometimes one has to use their own predictable rhetoric

to point out the flaws in the logic - of course it leaves those predisposed to running around in circles chasing their tails (or is that tales...)

[Wright Patman]

7. Public policy by lawsuit

is not a good idea. The article didn't mention that this time it is the wealthy school districts who have filed suit.

This is "class warfare" Texas style--the 10 percent of districts whose property tax revenues are being sent on a very modest scale to the 90 percent who are not superrich are going to the courts to stop "equity" in funding.

There was never any consensus developed on the school finance issue. That's why the session is ending without even coming close to passing anything.

With any luck at all, Goodhair will call another six or seven sessions in a row to no avail until everyone is ready to run him out of the state on a rail.

[bigluckyfeet]

9. In my county

In my county here in Texas,the county taxboard just raised the valuation on my house about 8 to 9% this year.The county,city,school board are scared to raise taxes directly,so they do it thru the back door.