Calling their opposition to tax relief “disappointing and discouraging,” State Sen. Charles Schwertner penned a stinging rebuke to big business associations. In a letter dated March 24, Schwetner takes special aim at the Texas Association of Business for opposition to tax cuts that will be considered on Wednesday.
“The Texas Association of Business claims to be ‘the voice of business in Texas,’ but how can that claim be reconciled with an active opposition to legislation that would relieve over half of Texas businesses from the burden of the franchise tax?” wrote Schwertner, a Republican from Georgetown.
He added: “If you’ll forgive me, it doesn’t seem as though you’re concerned with the state of Texas providing tax relief per se, just in providing tax relief that doesn’t directly benefit big business.”
Other big-business and trade groups opposing the franchise tax relief include: Texas Association of Manufacturers, Texas Taxpayers and Research Association, Association of Electric Companies of Texas, Texas Chemical Council, Texas Oil and Gas Association, and the Texas Association of Retailers.
These entities have instead called on the legislature to rapidly grow spending rather than offer Texans the “significant” tax relief championed by Gov. Greg Abbott and Lt. Gov. Dan Patrick.
A dozen conservative organizations are supporting the tax relief efforts, as well as the small-business groups spearheaded by the National Federation of Independent Businesses.
Meanwhile, more than two-thirds of the Senate has also signed on as authors of the primary tax relief measures.
In his letter, Schwertner specifically addressed the need for business tax relief to help small businesses: “Seventy percent of small-business owners start their business with less than $20,000 – an amount of funding that can hardly withstand franchise taxation. Further, as the franchise tax is based on revenues and not profits, it can be imposed on those businesses that operate at a loss. Small businesses are far more likely to fall into that category than big businesses.”
Schwertner’s Senate Bill 8, as well as SB1, SB7 and SJR1 will all be considered on Wednesday (March 25) by the Senate.