Here’s a novel idea. If Texas is truly facing a
surplus of revenue in the next biennium,
maybe lawmakers should give it back.
That’s the case being made by the Texas
Public Policy Foundation, which is proposing a
“Sales Tax Relief Fund,” a temporary reduction in
the state sales tax rate.
“The Texas comptroller’s recent estimate of a $2.6
billion surplus for the 2014-15 biennium is both a
clear indication that Texans are taxed too much and
an opportunity for the Texas Legislature to help Texans
realize those dreams by reducing the state’s tax
burden,” the Foundation’s Arlene Wohlgemuth wrote
in the Austin American Statesman on Sunday. “Returning
tax money to overtaxed Texans so they can
build their dreams is the right thing to do.”
The state could do so, easily, by lowering the state
“Creating the Sales Tax Relief Fund would mean
a noticeable and real reduction in the state sales tax
that benefits all Texans,” Wohlgemuth said. “It’s important
that our neighbors and communities keep
more of what they earn.”
Such a fund also would serve another purpose —
it could help end the bureaucratic practice of spending
every available dollar.
“If every penny of tax revenue is spent, legislators
will risk having to raise taxes during tough economic
times to balance the budget, rather than allowing
Texans to keep their hard-earned dollars,” Wohlgemuth
noted. “This is contrary to the conservative fiscal
policy approach that advocates for pro-growth
policies. It also lets people, rather than the government,
keep more of their money.”
Lawmakers will be sorely tempted to spend that
surplus when they convene in January 2015. We have
undeniable infrastructure needs, sputtering transportation
funding, and calls for more spending on
Some commentators are already calling on legislators
to spend the surplus, rather than send it back
to the taxpayers.
“I’m a little stunned that the Texas Public Policy
Foundation wants the Legislature to create a new
fund next year to hold unspent state tax dollars,”
said Jim Mitchell, of the Dallas Morning News.
“This proposal is short-sighted, even though the reduction
would save a typical household a couple
of hundred dollars a year and more if they happen
to make a really big-ticket purchase like a new car.
But Texas is a growing state and still has a leaky
roof and a bum hot water heater. Education and
transportation funding remain woefully inadequate,
and that is just the top of a long list of home
Mitchell calls for legislators to “invest” in the future,
rather than return money to taxpayers.
Lawmakers should resist this temptation. Our
transportation funding system needs reform, not just
more dollars. The gasoline tax hasn’t kept up with
our needs — mostly due to people driving less, and
cars getting better mileage. The gas tax should be
fixed, not merely augmented from the general fund.
Similarly, education funding should be reformed,
not simply increased.
Sure, it’s harder to reform spending that to just
spend more. But the Texas Legislature should follow
the Foundation’s advice, and give our money back.