As Texans across the state are reeling from high inflation rates and skyrocketing gas prices, a rumor is circulating among the Texas Legislature that next session may bring a $25 billion surplus.
Comptroller Glenn Hegar announced in November 2021 that he expects Texas to collect $23 billion more in state funds than originally expected. That would leave the Legislature with more than $25 billion in extra funds during the 2023 legislative session.
This surplus was created in part by a bill passed during the 2021 session that capped the growth of state spending to a rate that is in proportion to both Texas’ expected population growth and future inflation rates.
Some, however, are concerned that lawmakers will use the $25 billion surplus in a way that will only help enlarge Texas’ government, rather than benefiting taxpayers.
As Texans for Fiscal Responsibility (TFR) points out, lawmakers often use surpluses to continue spending exorbitant amounts of taxpayer money on government programs with little return.
“Lawmakers simply keep with the status quo and use surplus dollars as a slush fund to fund wasteful programs that continue to steal money from taxpayers and instead give it to things like corporate welfare programs, like the Texas Enterprise Fund, or throw it in the Economic Stabilization Fund (an emergency fund that is simply used as a piggy bank for ongoing expenses like public education funding),” says the group in their analysis.
TFR recommends that the Legislature use all $25 billion of the surplus on property tax relief for Texans. Instead of using the funds to expand state government, the group believes that the surplus should be used to pay down compression rates on Texans’ property taxes.
“Texans do not need their tax dollars going to fund more government; they need more freedom and less government. The conservative decision, when faced with the possibility of a $25 billion surplus, is for lawmakers to commit to giving EVERY SINGLE CENT back to taxpayers in the form of tax relief.”
According to the Texas Public Policy Foundation, property taxes in the state have risen by 181 percent over the past two decades. This increase has caused many Texans to struggle financially, and the strain has only worsened with rising inflation rates and record-high gas prices.
In last month’s primary election, more than 2 million Texas Republicans voted in favor of a proposition supporting the elimination of property taxes across the state. The results of this vote appear to show that conservative Texans are ready for some form of property tax relief.
TFR believes that if lawmakers use the $25 billion surplus to eliminate property taxes, they can win the support of conservative voters and show they will work to carry out other Republican priorities in the Legislature.
“This would result in the biggest tax relief in over a century and give much-needed relief to millions of Texans being crushed under the weight of inflation and rising gas prices. If this happened, voters might actually believe the narrative lawmakers continue to perpetuate in that we had the “most conservative session in Texas history.”