Texas Needs a Permanent, Progressive State Income Tax (Howe: rent, how much)

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Originally Posted by Milton Miteybad

All I know is that the less I pay in taxes, the higher my quality of life is.

So I'll stand with the good ol' Constitution of the Great State of Texas and vote "Forget it!"

Taxes are paid with real money. Debt is paid with promissory notes. We don't even pay off debt nowadays, but interest on the debt,

So, we don't pay income taxes responsibly, but we pay income interest irresponsibly.

[Slowpoke_TX]

Originally Posted by supfromthesite

Taxation is by definition theft

No, it's extortion. "Pay up or else."

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Originally Posted by Slowpoke_TX

No, it's extortion. "Pay up or else."

As kings ruled over kingdoms royally, Emperors war mongered over many kingdoms imperialistally. The kingdoms established wiithin empires didn't need armies. They paid a tax to the Emperor in exchage for his protection. Later, as empires (colonialism) fell outcof fashion, the king utilized lawyers to take the people to court in order to deem any work done on his property as illegal. In this case, the tax became a penalty.

As the United States itself becomes even more imperialistic, those working for the federal government and those living within Washington DC will hold superior status over those common peons having to struggle surviving in the inferior states.

Did you know that the federal flag in Mexico looks different from the one flown by the lessor states there? It has far more gold in it.

[lepoisson]

Originally Posted by Sunderpig2

Since moving into a worthless state that has income taxes, I've had to give away thousands of dollars of earned income (in just a few years) that I would have kept while in Texas. And if I made more money, and/or have lived here longer, it would be in the tens of thousands of money lost. And for what? I see no sign of that money going anywhere useful. I've investigated, searched, looked high and low, and found no details.

So to the pro-income tax folks: do you like giving away your money to others for no apparent gain? That's what it amounts to. It's like someone reaching into your wallet or getting into your bank account, removing the money, and going off with it in no apparently definable or traceable way. It's legalized theft. Just because it's law doesn't make it ethical and justified. You also have to believe and trust that governments will spend your money better and more smartly than you do. If you buy into that, then you're a naive little puppet and do deserve to have your money taken from you.

The longer one lives in a state with income tax, the more agonizing it gets, watching more money get lost each year and see the total go up. Bravo to the states that don't resort to such theft, and don't exude self-righteous control over our money in these ways.

I mostly agree with what you said, but I did want to throw something else out there.

The state I lived in before coming to Texas was Missouri. Income tax there is around 6%, but based on your tax situation, you never end up paying 6% on all of your income. I made around $40,000/year as a teacher and ended up paying around $1000 to the state the entire year. At tax time, I was refunded around $300, making my total tax paid to the state $700.

But here's what I got with my tax money: A wonderful system of state parks and conservation areas, state-funded shooting ranges placed all over the state, property tax that is half what it is in Texas (for renters like myself, this means lower rent rates), and vehicle inspection that is 1/3 of the cost.

I didn't own a home in Missouri, nor do I own here, but I actually lost money by moving here because my car insurance increased by 50%, renters insurance increased, and I now have to pay $25 per visit to the shooting range (in MO I could go any time I wanted for free).

So I'm not saying I'm for or against state income tax. It's just nice to weigh the options.

[Vacanegro]

Originally Posted by lepoisson

I mostly agree with what you said, but I did want to throw something else out there.

The state I lived in before coming to Texas was Missouri. Income tax there is around 6%, but based on your tax situation, you never end up paying 6% on all of your income. I made around $40,000/year as a teacher and ended up paying around $1000 to the state the entire year. At tax time, I was refunded around $300, making my total tax paid to the state $700.

But here's what I got with my tax money: A wonderful system of state parks and conservation areas, state-funded shooting ranges placed all over the state, property tax that is half what it is in Texas (for renters like myself, this means lower rent rates), and vehicle inspection that is 1/3 of the cost.

I didn't own a home in Missouri, nor do I own here, but I actually lost money by moving here because my car insurance increased by 50%, renters insurance increased, and I now have to pay $25 per visit to the shooting range (in MO I could go any time I wanted for free).

So I'm not saying I'm for or against state income tax. It's just nice to weigh the options.

Yes, as lepoisson says, it is not so cut and dried.

You need to consider your total tax burden. If I pay 6% income tax but my RE taxes are half what they are in Texas then what am I saving ? Should I go back to renting ? Oh and my home is worth double outside Texas what it is worth in Texas but my Texas RE taxes are higher.

...and that doesn't even begin to consider the quality of the school system and it's effect on home values.

Do you think those who have owned a home in Palo Alto, CA for the last 20 years are crying about the 11%+ they are paying in State Taxes when their 3/2 home is worth 2 million dollars ? What about a job that pays $100K in CA and $50K in Texas - seems extreme but CA has lots of high paying jobs.

So it depends on your income bracket and position in life. Sure Texas is probably a good place to retire but that doesn't make it better for everyone in all walks of life.

[TheOverdog]

Do you think those who have owned a home in Palo Alto, CA for the last 20 years are crying about the 11%+ they are paying in State Taxes when their 3/2 home is worth 2 million dollars

Probably not because they are probably paying the equivalent of a 3/2 in property taxes even though their home is worth $2m due to Prop 13, which screws new purchasers at the expense of those who bought a long time ago and bumps up the price of new property because Prop 13 basically acts as a kind of a cap on what economists call 'imputed rent', making the difference between future rent rates and a current fixed home price greater than it is in places like Texas where as property value rises, property taxes rise roughly appropriately. Like my in-laws, who have a ~$1500 tax bill on a $750k house in SoCal. Nice deal if you were alive a long time ago to get it.

However, I disagree that TX needs an income tax instead. The tax rate (property or income) is ultimately just a 'made up' number as state governments decide how much income they want and then adjust taxes as needed. The argument against property tax assumes that somehow governments would take in less if we changed the sources. No.

There are comments to be made about the 'progressiveness' of certain taxes, but property tax (especially in a place like TX that has comparatively low house prices) is pretty darned progressive.

State income tax is also not nearly as progressive as the Feds because most states have fewer rate brackets and the highest brackets kick in at lower incomes. Like CA for example, where someone making $40k pays 8% and someone making $500k pays 12%. So income increases by 40X and taxes only increase by 1.5X.

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Originally Posted by TheOverdog

Probably not because they are probably paying the equivalent of a 3/2 in property taxes even though their home is worth $2m due to Prop 13, which screws new purchasers at the expense of those who bought a long time ago and bumps up the price of new property because Prop 13 basically acts as a kind of a cap on what economists call 'imputed rent', making the difference between future rent rates and a current fixed home price greater than it is in places like Texas where as property value rises, property taxes rise roughly appropriately. Like my in-laws, who have a ~$1500 tax bill on a $750k house in SoCal. Nice deal if you were alive a long time ago to get it.

However, I disagree that TX needs an income tax instead. The tax rate (property or income) is ultimately just a 'made up' number as state governments decide how much income they want and then adjust taxes as needed. The argument against property tax assumes that somehow governments would take in less if we changed the sources. No.

There are comments to be made about the 'progressiveness' of certain taxes, but property tax (especially in a place like TX that has comparatively low house prices) is pretty darned progressive.

State income tax is also not nearly as progressive as the Feds because most states have fewer rate brackets and the highest brackets kick in at lower incomes. Like CA for example, where someone making $40k pays 8% and someone making $500k pays 12%. So income increases by 40X and taxes only increase by 1.5X.

A state income tax is the first step in states taking it a step further and establishing their own state debt. There was a cool idea making the rounds suggesting that states should add onto the already existing federal load by issuing their own state issued money.

This is all being done so that we can enjoy fifteen minutes of equality together. We are selling the souls of our children into eternal slavery of serving our debt so that we today can create a snapshot for them. This is a model of an ideal equal society to live by one in which everyone has their own mansion and their own limousine service.

The promise to pay today has become a promise that our children will have to pay far far in the future. Someone is lying here.

[Texas Ag 93]

I've lived in several states where we've had to pay an income tax, and states where we have not. I have concluded that governments will get their pound of flesh from you either way. Moreover, my level of frustration (or not) about paying state income taxes depended largely on how progressive their system was and what I got in way of services.

For example, we lived in Missouri 5 years. I though the tax burden was fair to moderate. The income tax rate was about middle of the road, but property taxes were low. I thought the services were about middle of the road as well.

We also lived in Colorado. They have a flat income tax rate of 4.63% and about middle of the road property taxes. I was impressed by the County services, in particular Parks and Rec facilities. Because of what I perceived as a fair way to tax income (flat), paying income taxes there didn't bother me at all.

We have also considered, and ultimately eliminated, states based on what we perceived to be very high progressive income tax rates, specifically Oregon and South Carolina. For me, a lot of it boils down to fairness. Is the tax burden being evenly distributed to all citizens? If the answer is Yes, I am less inclined to be bothered by it.

[Sunderpig2]

Originally Posted by Texas Ag 93

We also lived in Colorado. They have a flat income tax rate of 4.63% ... Because of what I perceived as a fair way to tax income (flat), paying income taxes there didn't bother me at all.

Yes, but what about the difference the 'flat' income tax makes to individuals depending on salary or wage? If you make little money (say, minimum wage to maybe $12) - i.e. not really enough to live on - that tax will be a significant and debilitating chunk. (Been there, done that, and hating CO for it) The same percentage removed from someone with a $50k + salary on the other hand might seem trivial and acceptable. The higher you go up in salary, the more sensible the flat income tax becomes. At the pay of legislators, it's a laughable drop in the bucket.

Only when you've been unfortunate to be at the low end of the pay spectrum will a flat income tax hit home, and you fully understand. Of course, the state legislators, with their high-end salaries and governmental perks are never in that boat. They never have a clue about the impacts of their decisions on the poor and even skilled folks caught in underpaid jobs. Hence the problem with most of government in my opinion; they only truly understand their own.

I respect Texas for not having income tax. It seems odd and perverse to apply taxes specifically against working and income. There's more to it than just money; it's a mindset and philosophy. Many states don't get that, but Texas at least does.

[earthisle]

We have a regressive income tax now, it's called property tax