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Republican, Democratic leaders debate taxes Print E-mail
by Will Lutz    Thu, Jan 12, 2012, 11:51 AM

At today’s Texas Public Policy Foundation Policy Orientation in Austin, key leaders in the two parties debated the Texas tax system and what it should achieve.

Most of the fireworks at the panel discussion occurred when former House Democratic Leader Jim Dunnam of Waco squared off with House Ways and Means Chairman Harvey Hilderbran (R-Kerrville). (Dunnam currently works at the Texas First Foundation.)

Dunnam noted that Baylor Quarterback Robert Griffin III said that as he went to the National Football League, he left the Baylor athletic program better than when he found it. Dunnam asked whether we are leaving Texas better than when we found it?

Dunnam cited poor roads, low high school graduation rates, and high college tuitions as failings of the Texas tax system. He compared tax exemptions enjoyed by the oil and gas industry to welfare checks. Dunnam said no state tax policy change occurs without the blessing of Americans for Tax Reform’s Grover Norquist.

Hilderbran responded by noting that Texas is weathering the recession better than most other states. He credited the state’s pro-business tax structure as one of the reasons Texas is handling the recession better than other states.

Dunnam blasted the way the state restructured business taxation. He said that the state’s margin tax left a hole in the state’s budget and the state should raise as much money from the tax as was provided in property tax relief.

Hilderbran responded that the 2006 school finance package was always designed as a net tax cut. Hilderbran noted that, while it restructured school finance, the Legislature also increased spending on education.

Hilderbran said that the key tax policy question that he asks is what can we do to make Texas more attractive to business. He predicted the Legislature would balance the 2013 budget without a tax increase. Hilderbran also said the Legislature would take a serious look at addressing concerns about equity among businesses with the margin tax as well as the concerns of small business.

During the question and answer session, one person noted that when he visits public schools, he sees a lot of administrators and vice-principals. Dunnam said that as well as excessive money spend on football stadiums are local problems, and local voters should hold the elected school board accountable for those actions.

The audience also heard from Joe Henchman from the Tax Foundation – a non-partisan organization that complies tax data from all states. Henchman said the Foundation leans more toward neutral tax policy, where tax policy funds only essential services, than a role where tax policy tries to influence behavior.

Henchman said Texas has a favorable tax climate, ranking 45th for total tax burden, meaning that the state has the 6th lowest taxes per capita among the states. The state also has the 13th most favorable tax climate for business. The state has no income tax but has relatively high corporate, property, and sales taxes, Henchman noted.

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written by Jen Taylor , January 12, 2012

I think voters should also be concerned with crime and safety. I can get my own Texas home security system, but without increased police departments and more patrols, crime will still be a problem.

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