Skip to comments.Texas Margin Tax is the Epitome of Bad Tax Policy
Posted on 07/09/2014 12:54:32 PM PDT by ThethoughtsofGreg
With most legislative sessions for 2014 adjourned, many states are now looking forward to November. Other than elections, various ballot initiatives will be voted on later this year. Perhaps the most economically damaging proposal comes from the state of Nevada, where voters will decide whether or not to impose a 2 percent modified gross receipts tax, or margin tax on the states businesses. Currently, only Texas has the economically devastating margin tax, at 1 percent, and that has been the subject of multiple votes to repeal just in the 2013 legislative session. Other states, such as Washington and Ohio also have experience with gross receipts taxes. The Texas experience with the margin tax is an instructive lesson for other states that may consider its implementation.
The overwhelming academic consensus is clear that taxes negatively impact economic growth. But it is also worth noting that not all taxes equally affect a states economy. Taxes on income and capital are especially bad for economic growth, such as the personal and corporate income taxes. Taxes on consumption are much less distortionary and detrimental to economic growth. However, of all the different kinds of taxation that are available to policymakers, the margin tax is among the worst in terms of hampering economic growth.
(Excerpt) Read more at americanlegislator.org ...
It should be repealed, but our economy isn’t exactly being devastated by it compared to other states.
It is insane but that didn’t stop obamacare from imposing a tax on gross receipts for medical equipment.
Tax Within a Tax: ObamaCare Medical Device Tax a Death Sentence for American Medical Innovation, Jobs
I have written several times here on just how stupid this Texas Margin Tax is. It was all done in the name of not violating the state constitution prohibiting an income tax... the answer? Tax all revenue. It is a state sales tax on all services including all expenses.
Mary Fallon is just as misguided for proposing elimination of the state income tax in Oklahoma. Revenue to run the state has to come from somewhere and that somewhere is eventually higher property tax. Just like Texas, you can sort of afford soaring property taxes while you are working but if you are out of work or retired you can’t afford to live in Texas.
I’m convinced only idiots become politicians but it takes a majority composed of idiots to elect them.
He’s either extremely stupid or extremely evil. Or both.
Taxes are for the “little people”.
Texas may have the tax but it is enduring due to its strong economy. Its not that disturbing at 1% and I don’t think there is any desire to raise it. A state such as California could not with stand additional tax of any kind, they have taxed themselves to death multiple times over.