March 19, 2015

Replace the Texas franchise tax ... with what, #txlege?

Houston Chronicle business columnist Chris Tomlinson wrote earlier this week that it's time for the state of Texas to get rid of its state franchise tax on businesses.

I respectfully agree, as I Tweeted him back, because he said "get rid of" instead of "replace." (The same holds true for the inventory tax, as loophole-ridden and as badly designed as it is.)

The answer is: A state income tax. Well, that's the obvious answer in a state that's not as tax-phobic as Texas, even as schools struggle for money and roads fall apart under current funding.

Unless the Texas Legislature can craft a corporate income tax to replace the above state taxes, getting rid of those above taxes will mean even more suckitude in state services (except to lobbyists), yet higher sales taxes, or both.

This reminds me of President Lincoln. Radical Republicans in Congress demanded that he replace George McClellan as commander of the Army of the Potomac well before Lincoln puled that trigger.

"With whom?" he asked.

"Why anybody," Ben Wade said.

"I must have somebody," he responded. Change "somebody" to "something," and that's where we are now. We need to have columnists propose, and legislators adopt, a "something" to replace these taxes.

As for raising the state sales tax? Scrooge McOilDuck, otherwise known as The Comptroller Who Can't Understand Commodities Trends, Glenn Hegar, want to let businesses with less than $5 million in revenues pay no sales tax.

And, I'm sure Scrooge McOilDuck and the GOPers in the Lege have not put pencil to paper, or fingers to calculator, to figure out just how much money this would cost the state.

Actually, they probably figured supply-side economics would turn this into a magical new bonanza for the state.

In reality, if the Wingnuts of Wingnuts steamroll stuff like this, Texas will be the new Louisiana.

Texas: Heading to hell in a handbasket, but now, maybe twice as fast.

And that reminds me of another Civil War hero: Phil Sheridan, who famously said:
“If I owned Texas and Hell, I would rent out Texas and live in Hell.” 
He would surely still live in hell first, but might find fewer and fewer out-of-state takers wanting to rent out Texas.

No comments: