Vol 29, Issue 31 Print Issue

Which Pocket?

The property tax brings in more than the state sales tax, and it follows that killing property taxes and raising sales taxes to cover the difference would more than double those sales taxes. A one-for-one swap, according to a recent report, would raise the state part of the sales tax to 17.85 percent from 6.25 percent. Add on the other two cents now allowed for local governments, hospitals, transit systems and the rest, and the tab for a consumption tax would be 19.85 percent.

The numbers were cranked by former Deputy Comptroller Billy Hamilton on behalf of state Rep. Jim Keffer, R-Eastland. His full report is online.

Here’s a number of our own. The average price of a new car is floating around $30,000; the state sales tax on that — at the current rate — is $1,875. Doing the full property tax swap would raise that to $5,355. That assumes, of course, that lawmakers would replace the property tax dollar for dollar, and that they’d do it without changing exemptions or expanding the sales tax base.

Overall state and local tax loads remain lower in Texas than in most other states, according to the Tax Foundation. In 2009, the per capita taxes here were $3,197, ranking Texas 45th; the national average was $4,160.