AUSTIN, Texas — The Texas House today voted by a three-to-one margin to repeal the Telecommunications Infrastructure Fund tax, levied on all Texans since 1995. Its purpose was primarily to hard-wire public schools, universities, libraries, and public hospitals to the Internet.
The tax was assessed on telecommunications companies doing business in Texas to fund the TIF. Some companies passed the tax directly on to consumers, others absorbed it as a cost of doing business – which ends up being paid by consumers, shareholders or employees anyway. The 1995 law required this tax to be levied until the fund received $1.5 billion. The tax was scheduled to be abolished during the 78th Session, but was not. At the time, the Foundation’s president, Brooke Rollins, said “(I)n the world of politics, it is a truism that taxes never die, government just finds new ways to spend the money.”
Rollins issued the following statement on news of the vote: “I guess we got it wrong; a tax has died at the hands of the Legislature. We’ve never been so happy to be wrong. By eliminating the TIF tax, the legislature has made good on a promise to abolish a tax that no longer serves the intended purpose.”