Sunday, June 6, 2010

New Texas Taxes?

"From car washes to tattoos to bottled water, the list of items and services exempt from the sales tax totals $30 billion in forgone revenue--a tempting target for some lawmakers as the state faces a budget gap as big as $18 billion. ... [Rene] Oliveira's plowing ahead with his work, which has included determining the policy reason for each exemption and whether that reason remains vaild. Other lawmakers have joined in seriously discussing the idea of removing some exemptions. ... 'Certainly a sales tax on food, medicine and providers of medical services would probably not receive any serious consideration,' [Olivera said]. ... The state sales tax is 6.25 percent, and local taxing jurisdictions may impose additional sales taxes of up to 2 percent. ... Senate Finance Committee Chairman Steve Ogden R-Bryan, said any change in exemptions should be part of an overall tax reform effort and should be revenue-neutral, meaning any additional money raised would be used for something such as lowering the tax rate", my emphasis, Peggy Fikac at the Houston Chronicle, 31 May 2010, link:

Texas budgets for two years, so the $18 billion is $9 billion a year. I have seen Texas become more aggressive in collecting sales taxes. Why go through this effort for a "revenue-neutral" result? Who are these guys kidding?


Anonymous said...

Taking all state revenue sources into account, the state is expected to collect $167.7 billion in revenue for all state funds in 2010-11."[4]

$18 billion is a pretty big budget gap...

Collect more, spend less, raise rates... every state is facing the same issues... what happens when Pres-O's "stimulus" runs out?

Independent Accountant said...

The proverbial feces hits the fan as we are seeing in California and Illinois.