Business owners are filing their returns and preparing to their first Margin Tax Payment (replacing the old franchise tax).  The Dallas Morning News reported yesterday that various groups representing business owners are upset with the new tax and are making their feeling known to the Texas Legislature.

Why are they so upset?  The Texas Legislature passed a bill that reduced the ISD (school) tax rate roughly by fifty cents over tax years 2006 and 2007.  Generally speaking the tax rate cut, reduced the combined tax rate which includes the county, city and schools tax rate by approximately ten percent.  Commercial property taxpayers did not see a tax savings because the most appraisal districts raised their real estate values, which ate up the school tax rate cut.  Now commercial property taxpayers are preparing to pay their Margin Taxes which paid for the 2006-2007 school tax rate cut.

What is to be learned?  First the constitutionality of this new tax will be challenged immediately after the first payments are made.  Is the Margin Tax is in-fact a state income tax which is prohibited by the Texas Constitution.  The Texas Legislature in my opinion uses the same old group of techno-crates, lobbyist, politically connected individuals and political figures to attempt to come up with answers regarding the growing problem of increasing property tax liabilities.  In my opinion fresh voices and new ideas are needed.  The people of this state are capable of understanding the needs for new sources of revenue for local jurisdictions to provide goods and services to citizens.  They also expect and deserve truth in taxation.