Tax bill passes Texas House and working and middle class families get shafted

HB 3 has passed the Texas House of Representatives. The bill would lower the cap of property tax for all Texans that own property. Sounds good, right? It does until you read the fine print.

The measure includes a penny increase in the sales tax [making the highest sales tax in  the U.S.], taxing motor vehicle repairs, increasing the sales tax on auto and boat purchases, taxing bottled water, increasing cigarette taxes by $1 a pack ....

Democrats opposed the bill because all the tax revenue raised by new taxes would go to replacing school property taxes, not for improvements in public education.

This bill is giving a tax break to the wealthiest of Texans by placing the burden on middle class and working class Texans. These are regressive taxes that will affect those who cannot afford to carry this burden. For the wealthiest of Texans, paying a little more on sales tax will not hurt or even concern them. However, for those living paycheck to paycheck, an increase in sales tax can break the bank. Even the taxing motor vehicle repair hurts the working family the most. A working class family has a greater chance of owning a older vehicle that needs more repair while the wealthy family changes cars every 3-4 years thereby having any repair fall under the car's warranty.

In April 2004, Rep Garnett Coleman (D-Houston) said:

“Texans already pay one of the highest sales tax rates in the nation. Many working families cannot afford to pay more,” said Rep. Coleman.

The sales tax is based on consumption and is extremely regressive in nature. According to the Center for Public Policy Priorities, an average Texas family with an income under $19,500 pays 4.2 percent of their income in sales taxes. Meanwhile, a family with an income over $90,100 pays a mere 1.1 percent of their income in sales taxes.

“Raising the sales tax hurts those with the least the most because most of their income is spent on necessities,” said Rep. Coleman. “Moreover, the proposed shift in taxation would lead to a larger federal tax burden for Texans because sales taxes are not deductible,” Rep. Coleman concluded.

The Lege is once again taxing the working class to benefit the upper class in Texas. This bill does not even address the need for more money in our schools.

Shameful? Yes. Fortunately, I am hearing from Austin that there is no way the Senate will agree to anything like this from the House. This will leave the courts to decide what to do with our schools.