Amarillo, TX -- Lowering taxes for both businesses and consumers in Texas would go hand-in-hand with economic growth, according to one industry group - and they've got a plan to do just that.
On Wednesday (Jan. 16), The Texas Association of Business announced their "Tax Reduction Plan," which they say will take full advantage of the state's current economic momentum.
The State Comptroller's office recently announced a projected budget surplus of $8.8 billion for the next biennium. And the TAB Says using that surplus as a buffer for lowering taxes on business would foster economic growth.
"I think they're basing it on the idea that Texas has recovered somewhat, says P. J. Pronger of the WTAMU Small Business Development Center in Amarillo. "There's money going back into the Rainy Day Fund, so in order to stimulate the economy, a logical way to do that is to give some sort of tax relief to businesses."
Although Texas is considered one of the most business-friendly states, business tax revenue currently accounts for the lion's share of the total.
"In Texas, businesses pay 62 percent of all combined state and local taxes," says Bill Hammond, President and CEO of the TAB. "By comparison, the national average is about 40 percent, so we're doing anything and everything we can to reduce the burden on businesses."
Another provision would lift the sales tax on textbooks and computers to lower the cost of higher education. Ultimately, though, the plan is mainly aimed at business growth - and although tax exemptions on a state level aren't as significant as federal exemptions, experts say every little bit helps.
"Taxes are a hit on business, there's no question about that," says Pronger. "So any program you can come up with to find a way to reduce some of that taxation is going to make it easier for businesses to make it."
So far the plan doesn't have any official legislative backing, but the association carries quite a bit of weight in Austin.
If you'd like to read more about the plan or track the TAB's political contributions, follow the links attached to this story.
