Texas Public Policy Foundation Brooke Rollins has a great new article out in today’s Austin American-Statesman praising Governor Perry’s commitment to tax relief and calling on the lawmakers to seize this opportunity to eliminate the margin tax.
From the article:
Putting Texas’ complex business margin tax on the path to elimination would be the best way to provide tax relief because it would generate more jobs and general prosperity than other ways of cutting taxes. Texas State Reps. Linda Harper-Brown, Jim Murphy, and Scott Turner as well as Sens. Craig Estes and Ken Paxton have introduced bills to do just that.
To begin phasing out the margin tax (or franchise tax as it’s often known) the $1 million exemption could be made permanent and then increased. This saves thousands of small businesses from paying this special tax and gives them the planning assurance they need to build their businesses.
Additional tax revenue can be used to increase the exemption level, allowing more small businesses to thrive while expanding and hiring new workers in the process. In a few years the margin tax can be completely eliminated – even while overall tax revenue grows at a rate exceeding population and inflation.
This session has provided lawmakers with a truly unique opportunity: State budget writers have enough excess revenue capacity to begin eliminating the margin tax forever, helping to spur job and wealth creation across the board and making Texas the only state without a business or income tax. The only question is: are lawmakers up to the challenge?
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