Hi,

Texas is only one of about four or five states that does not have a state income tax. All revenue for the state's butdet come from sales and property taxes, so Texas has one of the most complex state sales tax system around.

In Texas only residents of the our state are subject to the state income tax. This is only fair, since the sales tax revenue is spent on project that really only benefit the local state residents like Texas Highways and Bridges which are some of the finest in the world. It wouldn't make much sense to subject a resident of NC, for example, to our tax, since NC residents do not benefit from expenditures under the Texas budget.

Perhap the most important thing under the Texas Sales Tax Law is determining who/what is taxable. For example, a contractor that install a heating/Air Conditioning system is subject to collect a state income tax if the system is installed in a commercial enterprise. If the system is installed in a residence, the state sales tax does not apply. Non-profit organizations are exempt from sale tax as are purchasers who acquire merchandise strickly for resale. Sale tax is only collect from the final purchases which prevent inflated tax due to churning.

Some merchandise is tax, and some is exempt. No tax is collected on basic groceries, while a tax applies to cosmetics. I would love to see Texas go to a simple state income tax, if it would eliminate the confusing mess of sales and property tax laws currently on our books.



LelandJ