Last week I was part of a rather heated discussion on facebook about Texas’ budget woes and proposed cuts to its education budget. One of the people involved in the discussion was a school adminstrator. I asked him how he would solve the supposed education cuts. He wrote this:
“A .01% increase in taxes would prevent all this. That’s $150 a year on a $150,000 house.”
.01% increase in taxes…
Seems really low, doesn’t it? It’s not. Here is how it translates into taxes:
My house is worth roughly $150,000 on the tax rolls. We paid $3,500 in property taxes last year. If they were to increase another $150, it would represent a 4.3% increase as I show in my math:
The reason for the difference is that the .01% increase is PER $100 of value.
Politicians framed this issue in such a way to make it seem like the tax increase isn’t that much when in fact it’s MUCH more than they make it seem.
The guy got rather testy with me when I told him that I would not be willing to fork over another $150 per year. My reasoning is that although it’s “only” $150, it’s a tax increase. Once taxes go up (especially property taxes), they seldom if ever come back down again. Once this particular budget shortfall is cured by a tax increase, they’ll find another place to use the tax increase. Not only that, the $150 is based on property value, which will most likely increase in the future.