AS I SAID, A BOON FOR THE WEALTHY AND A BURDEN FOR THE POOR -- TEXAS HOUSE BILL 3
As I said here and again in this post, Texas House Bill 3 would benefit our richest citizens and increase the tax burden of our poorest. The Republican attitude: "let them eat cake." Oops! As long as they can afford the new 3% snack tax!
Only Texans in households making more than $100,000 would receive a net tax cut under the tax overhaul bill that the House is considering, according to a nonpartisan legislative analysis.
Under the bill, the poorest 1.7 million households – those earning less than $23,000 – would see their tax burden rise more than 5 percent, as lawmakers would add a penny to the sales tax rate and sharply boost taxes on snacks and cigarettes.
The richest 840,000 households – those with annual incomes of more than $140,000 – would have their taxes cut nearly 3 percent, according to the Legislative Budget Board, a research agency run by a group of legislative leaders who track the budget.
"The net effect is raising taxes to the tune of $1.1 billion on all Texans making under $100,000 a year," he said, citing the estimate for how much more would be collected from 6.7 million households in fiscal 2007. The wealthiest 20 percent of households would pay $437 million less.
"Do you think that that is fair and real tax relief?" Mr. Dunnam said to Rep. Kent Grusendorf, R-Arlington, a leading architect of the House's proposed school finance and tax swap package.
Some tax experts said the House bill would make Texas' tax system even more regressive – meaning that the poor pay a larger percentage of income than the rich – than it is now.
Mr. Sullivan said the payroll tax would eliminate jobs filled by unskilled, poorly educated Texans. Under the bill, the existing business franchise tax would be repealed and all businesses would have to pay 1.15 percent of each employee's salary, up to $90,000 per worker annually.