01.22.09
Perry raises taxes on businesses
In conservative speak that’s exactly what this is, Texas jobless fund in a pinch.
Nearly a year ago, Gov. Rick Perry trumpeted $90 million in savings to businesses by temporarily suspending some of the burden of paying unemployment insurance taxes — money meant to replenish the unemployment compensation trust fund.
The suspended tax was reinstated this month, but officials said it won’t be enough to bridge the gap between the $414 million the state expects to be in the fund Oct. 1 and the $861 million it’s supposed to have
By law, the fund must keep an amount equal to 1 percent of all taxable wages in Texas.
Now the Texas Workforce Commission must decide whether to raise the tax, issue bonds to meet the shortfall or see if the state could use an interest-free federal loan, said commission Chairman Tom Pauken, a Perry appointee who took office after the tax was suspended by the commission last year.
Hmm…gee…and nobody saw the recession coming. Surely someone should have seen this coming before now. We must keep this in mind when our GOP elected officials start talking taxes and proposing schemes. As Perry is already doing, governor is talking about giving tax rebates. More from the HChron article.
The replenishment tax is just one part of the unemployment insurance tax. Last March, Perry directed the state to “bring that (replenishment) tax to a screeching halt for this year” when the fund stood at $1.6 billion.
By the end of 2008, the trust fund balance had fallen to $1.3 billion, Pauken said.
Unemployment insurance claims, meanwhile, have shot up. There were 133,000 unemployment compensation claims — including initial and continuing claims — as of Jan. 12, 2008. Not quite a year later, as of this Jan.3, the total was 218,000, Pauken said.
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Perry spokeswoman Allison Castle said the governor stands by his decision: “At the time, the fund had excessive balance and the right thing to do was to return that to the taxpayers.”
Yesterday on a right wing web site Lt. Gov. Dewhurst reaffirmed his support for a tax swap plan – lowering property taxes to raise the sales tax – that made it through the Senate in the previous session but didn’t become law.
While the GOP may not be acknowledging publicly that their dominance may be ebbing, they’re sure acting like this may be their last chance to pass right wing tax schemes. Voter ID and more tax swap shenanigans, especially shifting the state’s tax burden more on to the middle class and poor, should be expected.