Is Texas About To Cut Its Sales Tax For The First Time Ever?

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On Tuesday, the Texas House approved a $4.9 billion tax cut which contains a sales tax cut of 0.30 percent. Dropping the rate from 6.25% to 5.95%, it would be the state’s first-ever sales tax cut if Greg Abbott signs it.

The measure passed 141-0, in apparent preference to a parallel bill that would cut the sales tax more deeply.

Missing in any of this debate was the question of why we need a sales tax cut in the first place. The common Republican claim was that the sales tax is really a tax on businesses, who of course need government’s help desperately. With a unanimous vote, Democrats even bought into it. “When we cut the sales tax, we cut taxes for our Texas businesses,” state Rep. Trey Martinez Fischer, D-San Antonio, said. “But this $2.56 billion [the parallel bill]is a lot of money to give away when we have yet to meet our state’s needs.”

The bill, by Houston-area representative Dennis Bonnen of Angleton, is clearly a significant Republican victory. It does, however, still need to move forward in the Senate. “My hope is that as we get closer to the deadline we’ll have a clearer picture of what’s going to come out of conference on that issue,” said state Rep. John Otto, R-Dayton.

The Statesman explains the divide:

A month ago, the Senate approved a $4.4 billion plan that reduces local school property taxes – a campaign promise of Lt. Gov. Dan Patrick, who has drawn a line in the sand on the issue — but the House has yet to touch the three-bill package.

How to cut taxes has emerged as the biggest point of disagreement between the two chambers this legislative session, with each dedicating about half its $4 billion-plus package to business franchise tax cuts but disagreeing about what to do with the rest.

Sadly, many Republican legislators are in-fighting because some want to cut the property tax and others want to cut the sales tax. Without naming the motivator, of course, the question comes down to which cut helps the wealthy more. Which should legislators be more concerned with, purchase taxes or property taxes? Neither of course; the legislator should be increasing funds to environmental protection, schools, roads, and poverty alleviation programs.

Sure, some of it must come from bloated prison budgets and tax giveaways (not going to happen either, obviously), but some of it should also come from instituting a smart state income tax which divides the least-equal states from the most-equal. Of course, Republicans are continuing to swerve the state towards lower overall taxes, for no other reason than their depraved philosophy and political donor base.


About Author

Ben Sherman

Ben Sherman has been a BOR staff writer since 2011. A graduate of the University of Texas, Ben has worked on campaigns, in political consulting, and has written for other news outlets like Think Progress. Ben considers campaign finance reform the fundamental challenge of our time because it distorts almost every other issue in American politics.

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