Appraisals increase

"It has been acknowledged that property tax relief has not been as great as anticipated, partly because of higher property appraisals and also because school boards have been inching their tax rates back UP - which is allowed by law.

Pete Snider, president of Alco Glass Inc. in Mesquite, said his company illustrates the problems with the new tax. If the old franchise tax were still in place, he said, his business would have paid nothing because profits last year were marginal and just below the threshold for taxation. Under the new law, he will have to pay about $6,000. And as far as property tax cuts, he added, increased appraisal values will wipe out the savings his company would have seen in property tax reduction under the new school finance legislation passed in the last special session." per the Dallas Morning News

Mr. Snider's story mirrors conversations with local business owners subject to the new franchise tax. One owner stated that last year his franchise tax was $1,800 and this year his franchise tax is going to be $5,900. Another business who just completed the process of incorporating noticed that he would have paid zero last year, but this year he will owe $2600. The fact that businesses were to pay higher franchise taxes was one of the reasons for the reduction in local property taxes associated with schools. The Legislature cut school property taxes by one-third from $1.50 to $1.00. To replace that lost revenue, lawmakers increased the business franchise tax and added additional businesses who had to pay to the list and increased the tax on a pack of cigs by $1.00.

Regardless of the 43 cent are 32.5 cent tax rate local business owners who pay franchise tax will pay triple - enhanced valuations, additional franchise tax, and higher local school property taxes. The consumer will be the ultimate loser for prices will have to rise to compensate for the increased taxes.

Homeowners will pay double - enhanced property valuations and higher local school property tax rates.

Those of you having your nails done look for higher prices in the near future!