AUSTIN – The Texas Public Policy Foundation’s Talmadge Heflin, Director of the Center for Fiscal Policy, urged passage of House Bill 500 via testimony this morning in front of the Senate Committee on Finance—Subcommittee on Fiscal Matters at 8:00 a.m. in Room E1.036. The committee substitute for House Bill 500 offers $630 million in business tax relief and permanently exempts businesses with gross revenues of $1 million or less from paying the margin tax. The current exemption is set to expire next year.
“Small businesses and entrepreneurial innovation are critical to keeping the Texas economy thriving, but our job creators face an enormous hurdle in the form of Texas’ business tax, or margin tax. Our past research has shown the margin tax to be overly complex, punitive, and in need of serious reform, if not outright repeal. The tax is a ‘black eye’ on Texas’ otherwise business-friendly environment,” said Heflin.
“Improving Texas’ tax climate via margin tax reform is critical if we are to remain the nation’s #1 job creator. It is encouraging to see that Members recognize this fact too and are taking steps to improve the system by way of House Bill 500, a bill that was overwhelmingly approved by the Texas House last week. ”
Heflin continued, “The committee substitute for House Bill 500 offers $630 million in business tax relief by making permanent the small business tax exemption, reducing the rate by five percent, and limiting the tax’s impact in out years. The Senate would do well to pass this important piece of tax relief legislation.”
The Honorable Talmadge Heflin is Director of the Center for Fiscal Policy at the Texas Public Policy Foundation. Heflin served 11 terms in the Texas House of Representatives and chaired the House Appropriations Committee in 2003, leading the Texas Legislature’s successful efforts to close a $10 billion budget deficit without a tax increase.
The Texas Public Policy Foundation is a non-profit, free-market research institute based in Austin.
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