JWB H.C.R. 217 75(R)BILL ANALYSIS


WAYS & MEANS
H.C.R. 217
By: Denny
5-9-97
Committee Report (Unamended)



BACKGROUND 

Congressional tax legislation in 1986 eliminated the deductibility of
state sales taxes by federal income tax filers, but state income taxes
remained deductible.  Only 17 percent of Texas filers claim deductions for
taxes paid, compared to 28 percent of American generally, and deductions
for taxes paid as a percentage of adjusted income are almost three times
higher nationally than among Texas taxpayers.  Texas derives more than 55
percent of its current tax revenue from the sales tax, which is a
significant percentage increase since the early 1980s, when the
corresponding figure was less than 40 percent. Changes contemplated by the
75th Legislature would further widen the interstate deductibility gap, by
both broadening the sales tax and reducing the property taxes that remain
federally deductible. 

PURPOSE

The resolution requests the Congress of the United States to restore the
federal income tax deductibility of state sales taxes. 

RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not expressly grant any
additional rulemaking authority to a state officer, department, agency or
institution. 

SECTION BY SECTION ANALYSIS

 RESOLVED, That the 75th Legislature of the State of Texas hereby
respectfully request the Congress of the United States to restore the
federal income tax deductibility of state sales taxes; and be it further 

 RESOLVED, That the Texas secretary of state forward official copies of
this resolution to the president of the United States, to the speaker os
the house of representatives and the president of the senate of the United
States Congress, and to all the members of the Texas delegation to the
congress with the request that this resolution be officially entered in
the Congressional Record as a memorial to the Congress of the United
States of America.