By Ed Sterling
Legislation approved by the House and Senate last week reveal widely differing views on how to bring about tax relief to Texans in fiscal years 2016 and 2017.
Speaker Joe Straus lauded the preliminary approval of House Bill 31, legislation to reduce the state sales tax from 6.25 percent to 5.95 percent, resulting in a $2.66 billion revenue decrease, and House Bill 32, legislation cutting the franchise tax paid by many businesses by 25 percent and resulting in a statewide revenue decrease of $2.56 billion. Both bills were written by House Ways and Means Chair Dennis Bonnen, R-Angleton, along with several members credited as coauthors.
The bills, in combination, are intended to provide a form of tax relief that would be insulated from the powers of local taxing entities and appraisal districts. Straus said the House “looks forward to a productive conversation with the Senate about how best to deliver results on this issue and the many others that matter to our economy and to Texas families.”
Lt. Gov. Dan Patrick, on the other hand, praised the Senate’s preliminary approval of Senate Bill 1760 authored by Freshman Sen. Brandon Creighton, R-Conroe. “Sen. Creighton’s bill gives homeowners the ability to hold local government accountable for the demands they place on taxpayers,” Patrick said, and called the measure “another step in an overall plan to reduce property taxes for homeowners and businesses.”
SB 1760 would, if adopted by the House in its present form:
– Remove the requirement that taxpayers due a refund have to apply for it;
– Increase the interest rate on refunds due to taxpayers to 9.5 percent;
– Require local taxing entities to justify the necessity of a tax increase on notices and election ballots;
– Allow a court hearing an appraisal dispute to give preference to the testimony of an independent licensed appraiser;
– Require the state comptroller to compile and annually publish a ranked list of tax rates by entity; and
– Require a local governmental body that wishes to exceed the effective tax rate to first have a vote of at least 60 percent of the governing body in support of the tax increase.
Bills aim to retool certification
Speaker Straus on April 27 welcomed the House’s passage of HB 6, HB 7 and House Joint Resolution 111, measures that work together toward undoing the state’s practice of using general revenue-dedicated balances for certifying other parts of the state budget.
“For more than two decades the state increasingly collected billions of dollars in fees for one purpose, but then used that money instead to certify spending in other areas of the budget,” Straus explained in a news release from his office. “The House began working to end that practice almost three years ago, and in the 2013 session, the Legislature reduced the use of dedicated funds for budget certification by nearly $1 billion.
“This session, the House is well on its way to reducing that amount even further, from $4.5 billion to $2.9 billion. And if voters approve HJR 111, which the House passed today, we will end this practice altogether in the coming years.”