Proposing a constitutional amendment requiring the periodic review of state and local tax preferences and the expiration of certain tax preferences if not reauthorized by law.
The impact of HJR114 on state laws will be significant as it changes how tax preferences are handled. By instituting a system of regular review and an expiration timeline, the bill intends to ensure that tax preferences remain relevant and necessary. It may prevent the state and local governments from implementing outdated or unnecessary tax breaks, thus potentially increasing state revenue and promoting a more equitable tax system. The proposal is designed to increase governmental accountability in the area of tax legislation.
HJR114 proposes an amendment to the Texas Constitution that mandates periodic reviews of state and local tax preferences. It aims to create a structured process through which tax preferences can be evaluated and potentially expired if not reauthorized by law. This provision will take effect for tax preferences established after September 1, 2014, and those reauthorized from that date. Tax preferences that fail to gain reauthorization within a six-year window will automatically expire, unless the legislature sets a different expiration timeline.
General sentiment towards HJR114 appears to be mixed. Proponents appreciate the need for regular evaluations of tax preferences to ensure they are benefiting taxpayers and not serving special interests. They view the amendment as a necessary step towards more responsible fiscal management. Conversely, some opponents express concerns that the periodic reviews could lead to the removal of essential tax breaks that support local economies or specific industries. The debate highlights tensions between fiscal accountability and the necessity of certain tax incentives for economic health.
A notable point of contention surrounding HJR114 relates to the potential unintended consequences of expiring tax preferences. Critics worry that the automatic expiration could destabilize funding for services or support essential sectors by making them vulnerable to abrupt changes in tax policy. This concern raises questions about the implications for various stakeholders, including small businesses and local governments that rely on these preferences for economic stability and growth. The discussions around the amendment indicate a need for a careful balance between oversight and support.