Texas House Passes School Finance Bill By One Vote
The Texas House gave final approval to a measure that would change the way Texans pay for public schools on Thursday.
The tax bill sharply divided the House and was approved by a 70-to-69 vote. It replaces some property taxes with new consumer and business taxes. Under the bill, property taxes would drop to $1.23 in 2006 and $1.12 the following year. But to replace that money, state sales tax would increase from 6.25 percent to 7.25 percent. The sales tax base would expand to include bottled water, auto repair, and certain computer goods and services. The bill would increase the cigarette tax by one dollar from its current 41 cents per pack.
Money from the new taxes would only go to property tax reduction, not to schools. The bill also closes loopholes in the state's main business tax. Tax measures approved by the two chambers will likely end up before a panel from each side that would try to come up with a compromise.