During the recent Republican primary for state comptroller, state Sen. Glenn Hegar repeatedly endorsed eliminating local property taxes in Texas.
Borrowing from GOP opponent Debra Medina’s 2010 playbook, Hegar urged a shift to sales taxes to make up the more than $40 billion a year of revenue that cities, counties, school districts and other local governmental entities would lose.
Hegar, R-Katy, even suggested a very rapid transition to the new tax system. At a Longview tea party gathering in January, he told a man in the audience, “You just do it.”
This week, though, the governing implications of so massive a shift seem to have cooled Hegar’s jets.
Burying the property tax, after all, would require leaders to more than double the current rates of all state and local sales taxes.
See Exhibit 1 on page 1 (or page 5 of the PDF) of this comptroller’s report. You can readily see that state and local sales taxes, combined, yield about 32 percent of all state and local tax revenues in Texas. That compares with a whopping 47 percent raised by local property taxes. You get the picture.
On Thursday, Hegar campaign manager David White said Hegar “has been clear that we are many years away from being able to implement such” a shift from property tax to sales tax.
White repeated a response he gave The Dallas Morning News on Tuesday, saying “Glenn will review all options to reduce the burden on taxpayers.”
Democratic comptroller nominee Mike Collier, though, has blasted Hegar’s happy talk on property tax during the primary. Collier, a Houston businessman, called it an “unimpeachably bad” policy idea that would produce a monster increase in sales tax, shift power away from localities to the Legislature and “put our schools at unnecessary risk.”
He warned Hegar’s “promise” to eliminate the property tax would require sales tax “to be at least 20 percent — and possibly as high as 25 percent.” In most Texas cities today, the combined state-local sales tax rate is 8.25 percent. Collier even created an online petition drive so voters can protest “Senator Hegar’s sales tax.”
However, in a Thursday email blast that urged people to sign the petition, Collier incorrectly called Hegar’s proposal a “massive tax increase.” In recent years, Republicans have only advocated tax swaps, which presumably would be revenue neutral.
Still, Hegar seems to be switching gears on property tax abolition, pivoting from a “just do it” battle cry to a chin-stroking, “many years away” proposition. The rhetorical shift has given Collier an opening to start the general election battle — in March, not September.
Actually, Hegar’s idiotic idea would be a “massive tax increase” for a large majority of Texans. The whole idea of a tax swap is that some people wind up paying more, while others wind up paying less. The Republicans have floated various tax swaps in the past, and I’m sure you’ll be shocked to learn that a wealthy minority benefits greatly from them, while everyone else pays more. It’s true, as some people note in the comments to that story and on Collier’s Facebook page, that renters pay property taxes as part of their rent. Let me ask you a question: Which do you think is the more likely outcome of a Hegar-style tax swap – a massive, statewide reduction in rents, or a massive, statewide increase in profits for landlords? Take all the time you need before answering.
Anyway. Whether someone finally explained the math to Hegar or he realized that he might need to do more of a campaign than just pandering to fanatics, he has shifted from “we can do this right now!” to “this idea is many years away from implementation”. And in doing so, he earned a bit of media for Mike Collier. More like this, please. BOR and EoW have more.