Texans deserve to have their tax dollars spent wisely and efficiently. To keep Texas economically free and prosperous in the future, state and local governments should strive to use only the money they have and avoid loans and bonds to the extent possible. Moreover, state budgets should omit any pork barrel spending and limit themselves to fund only the core functions of government. And ultimately, if there are funds left over after funding these core functions, these funds should be saved to pay for these functions the following year – or returned back to the taxpayers. By living within its means year to year, our legislature can create a stable, free economic environment for generations to come.
State and Local Taxes
Texas taxpayers are the best arbiters of how their money is spent – not politicians. Given this premise, Texas state and local governments should aim to keep taxes as low as possible to keep more money in the pockets of citizens around the state. While the lack of a state income tax does give Texas a leg up against most other states in attracting businesses and people to move here, there are still other areas in tax policy Texas can improve upon to lower the tax burden on its citizens.
For example, Texas has the 12th highest combined average state and local sales tax at 8.12% and 14th highest property tax collections per capita at $1,635. Texas also lags behind 16 other states, including Delaware, New Hampshire, Virginia, and Colorado in overall tax burden (Tax as a percentage of personal income). So, while Texas does have a competitive edge in many areas, there is more that can be done at the state and local levels to lower taxes and make Texas the most prosperous and economically free state in the country.
Texas is the right place to do business, whether you are an individual entrepreneur, a Super Major oil company, or the world’s largest tech company. Lone Star Policy Institute wants to ensure that Texas remains competitive by providing a reasonable, predictable regulatory regime; highly-skilled workers; adequate infrastructure; and light taxation without gimmicky and biased incentives.