Phil Kings Tax Grab

Texas State Representative Phil King is known throughout the state as a friend of business and especially the utility and the gas and oil companies. With this in mind his blatant plan to aid business with his school funding proposal should not be surprising.

King is presenting this as a way to reduce the cost of housing. Everyone pays property tax, either directly or indirectly, and everyone dislikes making those payments. But if school funding doesn’t come from property tax it will come from another source and King’s plan would use sales tax.

Under the present system a tax is levied on almost everyone, including homes and most commercial and industrial property. If the King plan is implemented everyone would receive a property tax cut of approximately 56%, which would be good if were that simple. All of that lost revenue would be made up through increased sales taxes and eliminating the exemption on things like food. The business and industrial property owners have very few reasons to pay sales tax. The 56% property tax reduction they would receive would be made up with increased sales tax paid by consumers. And that, my friend, is you and I. Not only would we pay additional sales tax to make up for the amount of our property tax reduction but we would have to pay enough to make up for the reductions to those businesses. The burden of funding schools would shift from everyone pays to consumers pay.

This change would require a constitutional amendment and that is a long process. The legislative committee to begin this process will be appointed by House Speaker Craddick and therefore will be heavy on those legislators who are friendly to business. All voters and consumers need to keep a sharp eye on this one.