Proposing a constitutional amendment requiring any increase in a franchise tax rate to be approved by two-thirds of all the members elected to each house of the legislature.
The proposed amendment would significantly alter the process through which franchise tax increases are authorized in Texas. If passed, this measure would ensure that such increases cannot be enacted unless there is substantial legislative support, potentially making it more challenging to raise funds through this tax mechanism. This could have implications for state revenue, particularly in times when the state may need to increase funding for public services or infrastructure projects that rely on such tax revenues. Additionally, it suggests a movement towards stronger fiscal conservatism within the state’s legislative framework.
HJR95 is a joint resolution proposing an amendment to the Texas Constitution that would require any increase in the franchise tax rate to be approved by a two-thirds majority of all elected members in both houses of the legislature. This move aims to create a greater level of legislative oversight and agreement before tax rates can be changed, which supporters argue could lead to more prudent fiscal policy and increased accountability. Currently, increases in franchise tax rates can be implemented with a simple majority, allowing for quicker changes without as much consensus among lawmakers.
While proponents of HJR95 highlight the need for increased scrutiny and bipartisan support for tax increases, critics may contend that such a stringent requirement could hinder necessary funding increases during economic downturns or for urgent public needs. Opponents might argue that requiring a two-thirds majority could lead to legislative gridlock, where justified increases in tax rates are delayed or blocked by political disagreements. Thus, the effectiveness of this amendment in fostering responsible taxation versus stifling fiscal responsiveness will likely be a point of significant debate among legislators and the public.