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Analysis: Texas doesn’t have an income tax — and isn’t getting one any time soon

Lawmakers want voters to replace the current constitutional hurdle to a personal income tax in Texas with a marginally higher one. Think of it as insurance against something that isn't likely to happen anyway.

Texas State Capitol, June 12, 2017. State Capitol in the late afternoon on June 12, 2017.

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The Texas Legislature wants voters to amend the state Constitution — kind of a big deal — in a way that doesn’t really do much.

The Texas Constitution already requires voter approval before the state can impose an income tax and requires the proceeds from any such tax to be used for property tax relief and public education. Now voters are being asked to replace that with a constitutional ban on an income tax, which sounds fine until you sort out the final result.

Untangled, that would leave the current voter approval needed for a personal income tax in place, but without the education requirement. If the voters want a personal income tax now — calm yourself, they don't — all they have to do is vote for one. If the new ban passes in November, all voters would have to do to get a personal income tax is to vote for one. Both cases would require initial approval from a Texas Legislature that is, to put it mildly, violently allergic to personal income taxes. And the current version would require the money to be used for education and property taxes, while the new and improved version would remove any such requirement.

If the constitutional amendment is approved, Texans won’t be any more protected from a personal income tax, in practical terms, than they are today. But they might feel better about it, and they’ll be reminded — loudly, and soon — that the Legislature passed a bill expressing passionate disdain for that dreaded tax.

This has happened before. The current constitutional provision came after then-Lt. Gov. Bob Bullock expressed a fleeting interest in income taxes. One wonky argument in favor is that Texas is overly reliant on sales and property taxes because it doesn’t have an income tax — and that overall taxes would be fairer and more moderate if all three taxes were in the state government’s portfolio.

The political argument is easier to sell: The state can’t increase a tax it doesn’t levy, and one way to keep spending down is to limit the government’s sources of revenue.

Wonks hardly ever win arguments with politicians.

As a result, this will be fourth among the 10 amendments on the November ballot this year: “The constitutional amendment prohibiting the imposition of an individual income tax, including a tax on an individual’s share of partnership and unincorporated association income.”

It was a partisan vote on both sides of the Capitol this year, but the proposed amendment got the required two-thirds supermajority from both the House and the Senate to send it on to voters.

The current provision would require personal income tax money to be used mostly for property tax cuts and education — the big-ticket items lawmakers were so excited about in the most recent legislative session.

The proposed provision would allow personal income tax money to be used for whatever the brainiacs in a future Legislature want to use it for — but makes it marginally harder to put such a tax into effect.

Marginally. Both the current and proposed versions would require voter approval. But the new one would require a constitutional amendment, which means two-thirds of the Legislature would have to agree to send it to voters.

The bragging rights might be more tangible. This could be good politics for lawmakers who supported it, allowing them to yap about income taxes for a few months without having any real effect they'll have to answer for in the future.

In essence, they’re simply asking voters to change the description of why Texas doesn't have a personal income tax and setting themselves up for praise for signing on to that spectacularly popular sentiment.

But nod to the wonks on the way to the victory parade, and remember that they were the ones with a long-term plan for keeping public schools running without relying on ever-increasing property taxes.

Like it or not, things cost money.

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