Who's Afraid of a Tax Analysis?

[sonias]

Texas Observer 4/7/11

Who's Afraid of a Tax Analysis?
A hidden analysis of a $1.2 billion tax break surfaces—and lawmakers want to know why it was buried.

A wonky examination of a tax exemption hardly seems like a dangerous thing. Yet a nine-page analysis of a tax break for natural gas producers may have been kept hidden from the public and lawmakers, according to a key member of the House Appropriations Committee.

"Until today, this document was buried," Rep. Mike Villarreal, D-San Antonio, told the Observer.

At a House Appropriations hearing this morning, chief budget-writer Rep. Jim Pitts (R-Waxahachie) said he hadn't seen the document. That's remarkable, since the state is looking at a $23 billion budget shortfall and in desperate need of revenue. The analysis shows how deductions and exemptions have allowed natural gas producers to get away with paying just a fraction of the state's 7.5 percent "severance" tax. For many companies, their tax liability is zero. In the report, the Legislative Budget Board (LBB) calculated the cost to the state at $1.2 billion a year – about the amount of money needed to avoid shuttering nursing homes.

The details of the report are not entirely unknown. It's been leaked to at least tworeporters, who've written up the highlights, and the Senate has discussed closing the high-cost gas loophole. Still, it's unclear why the report itself wasn't released by the LBB to lawmakers and the public.

"I am shocked that the LBB invested a year-and-a-half in writing this report but never made it public," Villarreal said in a press release. "I want to know who buried this report.

More tax breaks (corn in the water) for the natural gas producers (pigs). $1.2 billion a year! And you wonder why Texas is getting fracked (Barnett Shale area) so badly? The Welfare Queens of Texas

:mad:

[sonias]

1. Tax cut comes at 'high cost'

Houston Chronicle 3/27/11
Tax cut comes at 'high cost'

Imagine $1 billion vanishing overnight from the state treasury. That's essentially what happened in September — just as Texas lawmakers learned they would face a $27 billion shortfall - when the oil and gas industry reaped a windfall from legislation quietly passed in 2003.

Poof! About $1.2 billion in potential tax revenues disappeared from the books, leaving less money for hospitals, schools, roads and all the other worthy things the state budget supports.

The story of the vanishing billion dollars provides some useful insight if you've been wondering why our prosperous state has a budget crisis.

The state of Texas enjoys enormous bounty from "severance" taxes, paid by the oil and gas industry for the right to "sever" minerals from Texas lands. But in 1989, the Legislature created an exemption for "high-cost" gas - as a temporary measure, mind you - to encourage expensive and technically difficult gas production. Lawmakers extended the exemption in 1995 and 1999, when it was promoted by state Rep. Tom Craddick, R-Midland.

Then, in 2003, when Craddick became speaker of the House, the Legislature passed a complicated bill with dozens of "technical corrections" to the state tax code. Tucked inside was a single line that struck the expiration date of the high-cost gas exemption. As a result, the tax break became permanent, instead of expiring last September. With that tiny "technical" change, the state lost the ability to collect about $1.2 billion a year in additional taxes.

Frack you Tom Craddick! :puke:

[They_Live]

2. I have a feeling that this is only

the tip of a huge financial deception iceberg. Something is very fishy about the budget shortfall.

AUDIT!