Texas House members, in approving a measure last month to cut school property taxes and raise sales taxes, passed up taxes on different industries that might have yielded several billion dollars in state revenue. Such proposals -- including taxes on real estate transactions, commercial leases, alcohol and newspapers -- likely would have reduced pressure to raise the sales tax.
With the Senate still drafting potential tax changes, including an expanded corporate franchise tax to offset lower property taxes and to pay for public education, the House experience illustrates the difficulties of adding taxes without riling the watchful lobby and imperiling legislative success.
Each idea in the House debate was opposed by powerful constituencies, all insisting the additional sources were too troublesome to collect or too painful to pay.
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House Bill 3 tries to make up for the property tax cuts by raising the state sales tax by a penny, applying the tax to new services, adding extra taxes on junk food and cigarettes, and requiring businesses to either pay the state's franchise tax or a payroll tax. The biggest money comes from the sales tax increase, which critics complain would take a disproportionate toll on poor and middle-class Texans.
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http://www.statesman.com/news/content/auto/epaper/editions/wednesday/news_2435988c01741129009e.htmlSurprise, surprise, surprise!