Friday, October 16, 2009

Trailblazers blog gives Kay 3 peppers for misleading on taxes...

Kay keeps going around the state saying that Rick raised taxes. The Dallas Morning News looked at this claim and found that it was hogwash (link). Excerpt follows...

Wayne Slater examines Kay Bailey Hutchison's recent statement about Rick Perry's record on taxes:

THE CLAIM: Kay Bailey Hutchison told WBAP-AM (820) this week that Gov. Rick Perry "has increased taxes in Texas." Specifically, she said: "He's increased it on business -- the margins tax, which I think is a flawed policy. And secondly, he has not addressed the rising property tax rates in this state."

THE FACTS: Perry did lead the Legislature's effort in 2006 to raise taxes on business as part of a tax swap to cut local school property taxes. The effort expanded the state franchise tax, which corporations did not pay, to include all businesses with annual gross receipts over $600,000. The result was that many businesses saw their taxes increase by thousands of dollars. This year, the Legislature raised the exemption to $1 million, a move that Perry supported and signed into law.

As part of the tax swap, school property taxes were reduced from the state cap by a third, from $1.50 per $100 of assessed value to $1. For many taxpayers, that reduction has been eroded because of rising property valuations and a provision that allows some districts to raise their cap. But rates were in fact cut across the state.
Perry advocates further limits on rising property values, but the Legislature has not gone along.

To combat a budget shortfall, Perry and the Legislature have also raised several state fees. Among the increases were vehicle registration costs, tens of millions of dollars in surcharges on traffic violation fines, and professional fees for lawyers, nurses and tow truck operators.

BOTTOM LINE: Hutchison's statement that Perry raised business taxes is true. But by failing to note that doing so was a way to offset a big cut in property taxes, she distorts the governor's record.


It was a clear net tax cut. When Grover Norquist endorses your tax reform plan, as he did with Perry's reform, it is especially laughable for KBH to make her false claim that Perry raised taxes. Norquist HATES higher taxes.

This Fact Check like all of the Dallas Morning News Fact Checks needs its own Fact Check...

Rick took some heat from small business owners for the margins tax, but I think he won them back by and large by upping the exemption to a million dollars. In the end a lot more people saw property tax relief than got hit by a margins tax. In fact the margins tax did not bring in nearly the money some people had predicted...

I think if Rick could get a handle on local appraisals he could really get credit for a major tax cut but as it stands now all the local entities jacked up their appraisals to circumvent the rate cuts so he can only really stand in front of voters and say he gave them a modest net tax cut.

Bottom line, it was a net tax cut. Kay is not telling the truth when she sez Rick raised taxes. I think even liberals like Democrat state senator Elliot Shapleigh would agree... Rick is not a tax hiker. As the commenter on Trailblazers sez, Grover Norquist liked Rick's tax reform plan because it was a net tax cut...

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