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Officials hesitant on small business owners repeal efforts

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The Ellis County Press

HOUSTON – Hundreds of Ellis County small business owners could see double-digit increases in the state’s new business income tax if certain exemptions aren’t made, according to news reports and small government advocates.

Passed two years ago when the state Supreme Court ruled Texas’ system of property taxes to fund public education was unconstitutional, the business income tax – also called the franchise or margins tax – has been a platform issue for several business groups and candidates – including Milford’s Paul Perry, who took in 33 percent of the vote for state GOP chair last weekend.

According to the Dallas Morning News, businesses with gross receipts of $300,000 annually are exempt, as are all sole proprietorships and businesses with less than $1,000 in revenue.

Businesses with revenues of $300,000 to $900,000 would pay less taxes on a sliding scale, according to the DMN.

The rate, according to state Web sites, is 0.5 percent for retailers and wholesalers, but one percent for larger retailers and wholesalers.

Comptroller Susan Combs, a Republican who served as the state’s agricultural commissioner, held off collecting the business fees for a month so her office could study the legislation’s complex rules and regulations.

In a RightOnline.com question-and-answer session last Thursday with House Speaker Tom Craddick and state Reps. Myra Crownover, R-Denton, and Rob Eissler, R-The Woodlands, The Ellis County Press posed a question about whether the business tax should be repealed.

Craddick, before the three lawmakers asked that video feeds be turned off for the session, said it was too premature to talk about a repeal.

State Sen. Dan Patrick, R-Houston, whom this paper also interviewed on camera, talked about his supporters calling for a business income tax repeal. He later had Craddick appear on his popular Houston conservative radio show.

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