State Income Tax, 'splain to me, please

[l00p]

I know that many are VERY passionate about there not being a State Income Tax in Texas. Proponents of it say things like it will reduce or get rid of property taxes. Opponents have their weigh in on it too.

I have not invested much time into what the differences to a home owner it could make. I do know that it comes up here and there as a platform issue. Texas is conservative enough for the time being that I don't think it has a chance. But in ten years as the demographics continue to change and if somebody can actually get the Hispanics and minorities (no, Hispanics are not a minority in Texas any longer) to vote things could get interesting.

I know some of you are well versed on this topic. Can you explain the pros and cons, please? I don't know where I stand on this issue but do like the dream or idea of there not being a property tax. I don't believe it could happen. Entities don't just give up cash cows to abuse.

If there was a vote in November for it I don't know how I would vote and would abstain until I had a good opinion. Give me one.

 

[Sangre Naranjada]

In reply to:

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[l00p]

Good point...BEFORE. That would be a key to me too. I, like you, don't think they would just stop the property tax if they can still milk it.

I was not living in Texas when the whole lottery thing came about but remember the promises to get it through and then not delivering on said promises.

As a home owner who is only a couple of years away from paying off my house I have to say the dream of not having taxes to pay like now seem to be like Utopia. Man, it would rule! That would be even more to throw into retirement.

 

[Little Earl]

I don't see how a property tax would ever be eliminated in Texas. Remember, you not only pay school taxes this way, but also city and county taxes, and often hospital district taxes, water district or MUD taxes, emergency services district taxes, maybe even community college district taxes. I think the only hope is that a property tax would offset some/most of the school taxes, but I don't see school taxes going away in districts that have above average school expectations, or in fast growing districts.

 

[Mr. Deez]

If you could remove politics from the equation, the income tax is a much fairer tax system than the property tax. It's far more objective to determine income than property value. In addition, income is a far better indicator of ability to pay than property value.

Here's the problem - you can't remove politics from the equation. Income taxes have a bad record of turning into monstrosities that are complicated, very unfair, and oppressive. The reason why that happens is that they become a money grab and a weapon of redistribution rather than an unbiased tool to raise revenue.

If we adopted an income tax, it would need massive constitutional taxpayer protections, unlike the federal income tax. First, the property tax system would have to be constitutionally eliminated, not just reduced. Second, a progressive rate structure would have to be banned. Third, the overall tax rate would have to be constitutionally limited. Fourth, actual revenue growth would have to be limited to population growth and inflation. If it exceeds that, then taxpayers automatically receive a refund in proportion to their tax bill.

Constitutionally mandate all of those protections, and we'll talk

 

[l00p]

Thanks all.

 

[accuratehorn]

Income tax is a progressive tax.
Property and sales tax-regressive taxes.
Texas...not going to be accused of being progressive anytime soon. Any politician who brings up a state income tax would be staked to an anthill and covered in grape jelly.

 

[Larry T. Spider]

I have a lot of issues with property taxes, but I like the element of local control that is in place. If its a state income tax only, you are giving all of the money to the politicans and hoping to get back a decent amount to run your local area. Special interests get involved and its quickly becomes a mess. You have much more say in how your county or local school district is run than the entire state.

 

[nashhorn]

I too have issues with property taxes but I hate income tax. It still kills me that the govt can say when I make more I owe them more. Yes I understand all the arguments of obligation to military/police, etc but it elks me for all the issues Deez mentions. The more successful I became the more I resented having to fight IRS to keep it. Just me maybe.
I have become more and more in favor of a flat tax, or even a straight consumption tax like a National sales tax (if our insane income tax code was eliminated of course). After 5 audits in my life, one an honest error for which I had to pay and the others just garbage and for which the IRS never had to pay me for the waste of time, strange, I now detest everything IRS related.