Rising property taxes would eat up most of Perry tax cuts
Texans might not feel much relief even if lawmakers were to enact Gov. Rick Perry’s call for $1.8 billion in tax cuts because of rising taxes elsewhere.
Senate Bill 1, the budget legislation on which Perry bases his proposal, includes an assumption that property values across the state will rise enough over the next two years to cover $1.5 billion of the $2.2 billion needed for enrollment growth in public schools.
The state budget does not rely on property taxes. But under the school finance system, the state’s funding obligations to school districts go down as local property values go up. Local property taxpayers pick up the difference.
Perry said he would leave the details of tax relief to legislators so it’s too early to say which taxpayers would benefit from any reduction in state taxes. But it is clear that the state is banking on many Texans paying more in local property taxes in order to balance its own books.
More at http://www.statesman.com/blogs/content/shared-gen/blogs/austin/politics/entries/2013/01/30/rising_property_taxes_would_ea.html/ .
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