Doing the Unnecessary Ridiculously

Yesterday, May 21, 2019 at 4:31 p.m., HJR 38 was enrolled, which means that on November 5, 2019, Texas voters will have the opportunity to prevent future legislatures from adopting a personal income tax in Texas without a constitutional amendment, proposed by a two-thirds vote of both chambers and a majority vote of those voters who participate in a special or general election. I have no doubt that the small percentage of Texas voters who will vote on November 5, 2019 will overwhelmingly support the amendment. Why would they not support it?

There are several reasons. Most are provided by the House Research Organization's Bill Analysis, which is here. However, I would like to elaborate on one reason cited by the HRO: "HJR 38 would rule out the possibility of introducing a tax that could offset the regressivity of the state's tax system and provide a solution to the state's school property tax and school finance problems." This simple statement needs unpacking. Texas has one of the most regressive tax systems of the fifty states and the District of Columbia. Of revenues provided by taxes in Texas, 57 percent comes from the general sales tax, which is highly regressive. Another 9 percent comes from the motor vehicle sales and rental tax, and 7 percent comes from the motor fuels tax. Cumulatively, those sales taxes constitute 73 percent of tax revenues. The chart depicts the array of taxes in Texas in FY 2018.


 Currently, Texas is experiencing a problem (I'd say crisis) in funding public education. As the state's contribution to funding for public education has collapsed, local school districts have been forced to increase the local property tax to pay for educating Texas' children. The increase has caused a number of problems, leading to a consensus that property taxes, of which local school district taxes are the highest, have become untenable. In the current session, the idea of increasing the general sales tax by one percent was championed by the governor, lieutenant governor, and speaker of the House. However, there was little support for this proposal. According to a UT/Texas Tribune poll, increasing the general sales tax was just as unpopular as a personal income tax.

So, fearful that Texans might some day realize that a personal income tax, whose proceeds are dedicated to reducing the local property tax (two-thirds of the proceeds) and to support education (one-third of the proceeds), might be adopted, Representative Leach proposed a constitutional amendment to prevent a personal income tax in Texas--HJR 38.

Now it's up to the public to become educated. To realize that a personal income tax would be less regressive, that it would reduce property taxes, and that it could provide the funds necessary to fund public education adequately in Texas. Who's going to do that?

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