Perry campaigned to “wait and see” on taxes; Craddick has declared any new taxes unnecessary; and Dewhurst — well, Dewhurst, the outgoing land commissioner who has (with more energy than accuracy) trumpeted his fiscal prudence at the General Land Office, did not even respond to Perry’s budget letter. (He punted to Commissioner-elect Jerry Patterson.) Thus far the only Republican floating what amounts to a tax bill is Pampa’s Warren Chisum, who has proposed (but not yet filed) a $5 to $7 “environmental impact fee” for every vehicle or engine over 50 horsepower. (Translator’s note: Tax bills authored by Republicans are known as “user fees.”) Last session the Lege tried unsuccessfully to fund federally mandated ozone pollution reduction by slapping a huge fee on vehicle registrations for new Texans — hence the “impact fee,” which is regressive and spares industrial polluters, but at least spreads the burden.
Dallas Democratic Rep. Steve Wolens’ HB 53 would boost the cigarette tax 50 cents to fund local law enforcement and fire protection. The American Cancer Society is promoting a $1 tax per pack, which it says would “produce $5 billion in long-term health care savings and raise roughly $1 billion a year in new revenue.” The ACS wants some of that money dedicated to anti-smoking programs for youth (the tobacco industry righteously denounced the proposal as “taxpayer profiling”). On the other hand, the Texas Association of Business proposes cashing in (“securitizing”) the state annuities from the tobacco lawsuit settlement for a one-time ready payment up front. A few states have done it — damaging their bond ratings in the bargain. Craddick has initially rejected that recklessness, but May budget frenzy has a way of undermining December wisdom.
Last week the Center for Public Policy Priorities released “primers” on the state budget and taxes, and proposed a series of tax reforms (www.cppp.org) that could raise more revenue while sharing the tax burden more equally: extending the sales tax to services (except medical and dental); mandating full rendering of commercial property to local tax districts; extending the franchise tax to business partnerships and closing related loopholes; raising taxes on cigarettes and gasoline. According to the comptroller, the first of these alone would raise $7.5 billion for 2004-2005, and the rest are eminently sensible. When several were proposed during the Bush administration — with tacit support from the governor — they were scuttled at the last moment by the GOP’s anti-tax hard-liners.
This article appears in December 13 • 2002.