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Posts Tagged ‘business margins tax’

Wrapping up the rest of the regular session

So as we now know, a special session on redistricting has been called, though we don’t yet know what if anything else may be added later. I covered that last night, so let’s cover what else got done at the end of the regular session, beyond what I noted below. First of all, the budget […]

We appear to have a budget

Took them long enough. After days of jockeying and one-upsmanship, the Texas House and Senate each approved measures Wednesday evening critical to passing their next two-year budget. “The results of these two bills together is a good conservative budget, and it’s something we can all be proud of,” said Senate Finance Chairman Tommy Williams, R-The […]

Abbott is gearing up for Governor

I have two things to say about this. Gov. Rick Perry hasn’t yet said whether he’s running for re-election — but Attorney General Greg Abbott doesn’t appear to be waiting for him to make up his mind. Abbott is collecting résumés and assembling a gubernatorial campaign team. He’s shaking hands, giving speeches and edging his […]

From the “Tax breaks for me but not for thee” department

There are two types of people in Texas: Those for whom the tax code is written to favor, and everybody else. The Dallas Country Club, not a place usually thought of as needing a huge tax break, used a quirk in state law to reduce its taxable value by nearly half. Valero, one of the […]

Margins tax breaks passed

Someone’s getting a tax break. Probably not you, though. The Texas House on Tuesday tentatively cut hundreds of millions of dollars from the state’s primary business tax — cuts that proponents say will keep the Texas economy humming and opponents argue cost too much. House Bill 500 is the primary legislative vehicle to address the […]

That’ll just about do it for gambling this session

Sen. Carona calls the chances “slim”, but it sounds like slim just left town to me. [Sen. John] Carona, chairman of the Senate’s Business and Commerce Committee, said last week he expected to vote his sweeping gambling bill out of his committee Tuesday. But the morning committee hearing came and went, and Carona declined to […]

It’s always time for a tax cut

I have three things to say about this: With less than two months remaining in the 83rd legislative session, Gov. Rick Perry on Monday called on state lawmakers to find $1.6 billion to give Texas businesses relief from the state’s franchise tax. Perry’s proposal consists of four parts: reducing the overall franchise tax rates by […]

On encouraging jury service

District Clerk Chris Daniel notes that many people do not get paid when they take off work to serve on jury duty, and that therefore they generally choose to ignore their summonses. During the upcoming session, the state Legislature can address this issue and ensure that jury pools include a true cross-section of county residents […]

Here come the tax cut proposals

When the sunny revenue forecast came in, we immediately got one crappy tax cut idea, to eliminate the margins tax at a cost of $4.5 billion. The Texas Association of Business didn’t care for the idea, at least at first, but are now warming up to it, because this is what they do. For Bill […]

The revenue estimate is in

And under normal circumstances it would be very good news. Texas Comptroller Susan Combs, laying out the parameters for state spending on the eve of the legislative session, said Monday that the rebounding Texas economy gives lawmakers $8.8 billion unallocated in state coffers for this budget period and an improving picture for the next two […]

A look ahead to the 2013 Lege

The Trib previews the biennial hijinks of the 2013 Texas Legislature. The last time Texas lawmakers convened in Austin, they were absorbed with numbers and boundaries: how to make ends meet with a deflated state budget and draw new district maps the courts would approve. But with improving fiscal conditions and redistricting mostly in the […]

Margins tax survives another challenge

Mighty quick ruling from the Supreme Court. The Supreme Court of Texas on Friday struck down a challenge by Nestle Inc. and two other businesses targeting the state’s franchise tax. Lawyers for Nestle and two Texas-based companies, Switchplace LLC and NSMBA, sued the state this year and argued that the tax violated the Texas Constitution’s […]

It’s usually a bad idea to bet on any kind of overhaul in the Lege

I agree that it’s a sucker’s bet to think that the Lege will try to fix Texas’ tax code in any meaningful way. Nobody likes having to take votes that may later be used as clubs against them in a campaign, and the lobbyists swarm like no other time when someone’s tax break is on […]

Once more with the margins tax and the Supreme Court

Here we go again. The Texas Supreme Court could blow a hole in the state’s budget if it finds the business tax unconstitutional, as pressed Tuesday in a lawsuit led by food giant Nestlé USA. “The Legislature can’t violate the constitution to promote even a legitimate interest,” said attorney Peter A. Nolan, arguing on Nestlé’s […]

Margins tax back before Supreme Court

Yet another challenge to that unloved tax. The Texas Supreme Court [Friday] accepted a case that will decide whether the state improperly administers its business tax. Nestle USA argues that the tax violates the Texas Constitution’s requirement that taxes be levied in an “equal and uniform” manner, as well as the U.S. Constitution’s equal protection […]

Revenues rise, but reality recognition doesn’t

Good news and bad news, because we can’t have one without the other. The latest bit of positive fiscal news came Tuesday when the state comptroller released numbers showing that business tax collections in Texas had exceeded projections. Comptroller Susan Combs had estimated that the franchise tax paid by businesses would bring in about $4 […]

Let’s party like it’s 2007!

Good news: The improving economy and steadily increasing sales tax receipts may mean that we won’t have another budget apocalypse in 2013. Bad news: The Republicans in the Lege will use this as an excuse to avoid fixing the state’s underlying revenue problems. The state’s rebounding economy should help Texas avoid another draconian budget session […]

At last, school finance lawsuit number 4

The fourth and presumably final school finance lawsuit was filed just before the holiday weekend. The state’s largest school districts, including Houston and Cypress-Fairbanks, have filed a lawsuit claiming the public education system is inadequate and inequitable, the fourth such suit filed since the Legislature ended its session in September. The latest suit involves more […]

State revenues inching up

A little bit of good news. State coffers will be bit plumper than previously expected, Comptroller Susan Combs announced Monday, but her outlook for the Texas economy is less optimistic. Texas is estimated to collect $1.6 billion more than was budgeted for 2012-13, the two-year budget that started Sept. 1. The comptroller’s report provides the […]

Supreme Court upholds margins tax

The days of the much-unloved business margins tax may be numbered, but it won’t be the Supreme Court that is responsible for its demise. The Texas Supreme Court turned back a challenge to the state’s primary business tax, saying it doesn’t violate a constitutional ban on personal income taxes. The Constitution allows personal income taxes […]

More schools join the lawsuits

Lubbock: The Lubbock Independent School District announced Monday they will join the Texas Taxpayer and Student Fairness Coalition in an equity lawsuit against the state. Simply put, LISD is receiving less money per student because they are one of the poorest districts, and LISD claims that is unfair. LISD officials say the district currently receives […]

Tax reform on the menu

The Lege, which was too busy slashing public school funding to address the structural deficit caused by the underperforming business tax and the too-big property tax cut, will try to address the issue in 2013. “I believe that next session there will be substantial tax reform and a broad review of tax policy,” House Ways […]

Class size issues are everywhere

We know that waiver requests to exceed the 22 student class size limit are way up. But that mandated limit is only for grades K through 4. What about higher grade levels? Patricia Kilday Hart reports that those classrooms are more crowded, too. Lamar High Principal James McSwain estimates his classes are on average 8 […]

Margins tax lawsuit goes to Supreme Court

Oral arguments for the lawsuit that claims the business margins tax is an unconstitutional income tax are being heard by the State Supreme Court this week. In a lawsuit filed in July, Allcat Claims Service LP , a Boerne insurance adjustment firm, said the margins tax runs afoul of a constitutional provision that requires the […]

Another school finance lawsuit update

The Trib brings some news about the impending school finance lawsuits. Yes, lawsuits – there are two in the works. The Equity Center’s lawsuit will focus on fairness, attacking the target revenue system established in 2006 when lawmakers reduced the property tax rate and guaranteed that districts would get no less than the amount they […]

More districts will join in school finance lawsuit

Coming soon to a courtroom near you. School districts will throw everything short of the kitchen sink into their upcoming lawsuit against the state of Texas for shortchanging public education, a lead attorney in the case said Tuesday. “We are going to try to cover the water front because the system is so out of […]

Inevitable school finance lawsuit update

Duly noted. Superintendents from several low and medium-wealth school districts appear ready to sue the state over its school finance system as early as October. Wayne Pierce, executive director the Equity Center – a group representing 690 districts – said Wednesday that superintendents and other local leaders decided at a meeting in Austin they would […]

Noted for 2013

When the next Texas Legislature gets gaveled in and hears the bad news about the ten-figure budget shortfall it will have to deal with, remember that at least one Republican involved in the budget-writing process this year says we won’t be able to cut our way out of it this time. Rep. Drew Darby, R-San […]

Lawsuit filed against business margins tax

Allstate Claims Service, L.P., which is based in Boerne, has filed a lawsuit alleging that the business margins tax is an illegally-passed income tax in Texas. Oh, boy. Nikki Laing, a CPA and third-year Baylor law student, studied the structure of the tax for a Baylor Law Review article titled “An Income Tax By Any […]

Talking about the T word

Scott McCown brings up the subject of taxes but leaves it short of where to go from here. If a stronger economy, honest budgeting and pitting priorities against each other aren’t the answer, what is? Texas must modestly increase taxes. No one is suggesting that Texas become a high-tax state, but Texas must raise the […]

That next school finance lawsuit is coming

Look for it when school starts this fall. Texas lawmakers who left town recently after cutting public education and doing little to fix school funding disparities have guaranteed another school finance lawsuit, according to educators and lawyers involved in the case. They expect to file a lawsuit later in September. “There’s going to be litigation. […]

From the “When you’re in a hole, go ahead and keep digging” files

Deficit, schmeficit. Texas lawmakers voted on Thursday to extend a tax break for businesses with revenues of less than $1 million a year at a time the state is facing a massive budget shortfall. The House Ways and Means Committee voted 8-0 to send the bill to the full House with three lawmakers absent. The […]

When you find yourself in a hole, go ahead and keep digging

So Texas has this big budget shortfall. You’ve probably heard about it. A big part of that shortfall is structural, thanks to the 2006 property tax cut that was supposed to be funded primarily by the business margins tax. Unfortunately, that tax was projected from the beginning to fall short, and it has turned out […]

School finance reform bills on tap

Whether you look at the House budget or the slightly less drastic Senate version, public schools will not get the funding they are due under the current defined formulas. That means that how the funds are distributed needs to be redone as well. The first bills to tackle this highly sensitive issue have been laid […]