On Election Day, Texas Voters Should Ban an Income Tax

Given Texas’s commitment to low taxation and limited government, it’s not surprising that the economy here is booming. Allowing people and businesses to keep more of their hard-earned money is the not-so-secret reason Texas continues to lead the country in job creation, economic growth, and inbound migration. And this Election Day, Texans will have the opportunity to double down on this recipe for success by supporting a constitutional amendment banning a state imposed income tax.

Thanks to the bipartisan efforts in the 2019 legislative session, a supermajority of lawmakers in the House and Senate approved placing House Joint Resolution 38 on the general election ballot. This gives voters the chance to amend the state constitution to prohibit the state from levying an income tax. Plain and simple: if a majority of voters vote in favor of HJR 38, it means under no circumstances could lawmakers impose a tax on individual income. To protect the interests of taxpayers across the Lone Star State, it’s vital that voters approve this important taxpayer protection amendment.

While it’s true that Texas is one of a handful of states that doesn’t already have an income tax, that doesn’t mean one couldn’t be imposed in the future. As we’ve seen on numerous occasions in other states, politicians often try to place new burdens on taxpayers to finance expensive projects and other government programs. With large spending increases on the agenda of many big government politicians, it will be increasingly difficult to hold the line on taxes. That’s why inoculating taxpayers against future tax increases is the responsible thing to do.

Codifying this constitutional provision would send a clear message to current and prospective lawmakers that Texans are serious about low taxes. Its enshrinement will ensure that no matter who controls the Governorship or the State Legislature in the future, taxpayers will never have to worry about having the state take your hard-earned money via an income tax. But most importantly, it will help insulate taxpayers and residents from the devastating consequences that result from tax increases.

Texas is a perfect example of the positive effects that occur when people are freed from the grip of over-taxation and over-regulation. By limiting government’s intrusion into everyone’s daily life, people and businesses are able to prosper. This is precisely why since 2010, about 2.5 million jobs have been created and real total incomes have risen by $500 billion. Further, millions of people have moved from high-tax states to share, and contribute to Texas’s success.

There is a reason why taxpayers from high-tax states like California, New York, and New Jersey continue to flee to lower taxed jurisdictions. These taxpayers recognize that they are needlessly overtaxed and are sick of their money being allocated to increase the size and scope of government.

Ratifying HJR 38 will also protect Texas’s commitment to small businesses, which are the lifeblood of the state’s economy. Most small businesses are pass-through entities that pay taxes at individual rates and aren’t subject to the corporate income tax. Therefore any individual income tax increase directly bites into the sustainability of small and medium-sized family businesses. Instead of focusing on the prospects of a tax increase, small business owners are free to invest into new equipment, raise wages, hire employees, or further expand their operations.

All of these activities contribute to economic growth, profitability, and more opportunities for workers.

Opponents of enshrining this provision into the constitution are concerned that prohibiting an income tax will restrict the ability for lawmakers to tackle a future economic crisis. It’s a good talking point, but their worries are misguided. In the event of another event as severe as the Great Recession, the very last thing lawmakers should do is raise taxes to fund Keynesian policies. As we’ve seen time and again, raising taxes is likely to exacerbate an economic crisis and leave everyone worse off.

The Texas model for growth and prosperity works and creates an economy that is inclusive for every taxpayer. In order to keep Texas the best state to live or start a business, voters must permanently ban the income tax this November. It wouldn’t impact taxpayers’ wallets today, but it could block future politicians with big ambitions to balloon the size of government. By taking away their ability to tax, it could hamstring their plans to transform Texas into a financially troubled state like California or New York.