From the IPI PolicyBytes Blog
With anticipated state revenues falling, more than a few fans of bigger Texas
government are whispering about the need for a state income tax.
Center on Budget and Policy Priorities, a liberal policy study group with
tentacles in Texas and other states, says, “Texas needs to address its
antiquated tax system.” The center suggests in another essay considering “new
sources of revenue as part of a balanced approach to our budget.”
more of the same if voters come to embrace Keynesian-Obamanomics responses to
the economic crisis: that is to say, spend, spend, spend.
despite a recent jump in joblessness, isn’t having a “crisis.” The state
government’s budget isn’t in the red, unlike the budgets of income-tax-levying
states like New York ($15.4 billion) and California ($40 billion). Indeed, it’s
been in the black for a while.
General revenues in Texas, according to
the state comptroller’s office, will be down by $2.2 billion for the next budget
cycle—dropping from $170 billion two years ago, including federal receipts, to
$167.7 billion. Meanwhile, an existing cash balance is said to have shrunk by
$6.9 billion from two years ago.
But that’s ample money to run the state
until the economy—the state’s as well as the country’s—recovers. Moreover, oil
and gas revenues have filled the state’s “rainy day” fund to the tune
(estimated) of $9.1 billion over the next two fiscal years.
“Antiquated” tax system? Sounds more like the result of the
“antiquated” concept of thrift and careful budgeting.
Certainly, with an income tax, we could spend a lot more. Why, though? So as to
get caught short, like California, with a deficit requiring even higher taxes?
The better way involves what we’re pretty much doing now—shunning
exuberant calls for government growth and remembering that Texas didn’t gain the
CNBC ranking of the “top state for business” by biting into even-larger helpings
of the private sector.
Come to think of it, shouldn’t the Center on
Budget and Policy Priorities be extolling Texas as a model for other states?
The real “antiquated” thinking is with groups that believe the only solution to
any problem is higher taxes.
To read more expert analysis from the Institute for Policy Innovation, click here.
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