Surplus refunded to taxpayers under Gov. Rick Perry’s plan

Flush with an oil and gas-generated surplus of nearly $9 billion, Gov. Rick Perry has called for a change in the Texas Constitution to allow the state to refund unspent revenues directly to taxpayers.

Perry brought the audience for his biennial state of the state address to their feet Tuesday morning asking the Legislature and citizens to help find $1.8 billion in tax relief during this session.

Surprised at the duration of the ovation, Perry remarked, “I’m proud that in Texas, we’re talking about the best way to give money back to the people who paid it.”

Perry, delivering his seventh state address to the joint meeting of the House and Senate, said Texas needed to take advantage of its role as a national economic leader and put its financial house in order.

To be able to return unspent tax money to citizens directly would require amending the state Constitution. Such an amendment would require approval by two-thirds majorities in both the House and Senate and by a majority in a statewide referendum.

Last year, with a budget surplus of $2.1 billion, the state of Indiana granted state tax credits of $111 for every taxpaying individual and $222 for couples.

“We’ve never bought into the notion that if you collect more, you need to spend more,” Perry said.

The governor’s office established a website soliciting ideas for how to provide the $1.8 billion in tax tax relief. At the same time, he called for an even tighter, more streamlined budget and a constitutional limit on spending growth tied to the growth in population and inflation.

The franchise tax exemption for small business should be made permanent, he said.

In the future, state budgets would not rely on budget gimmickry like dedicating collections of taxes and fees tied to specific bills only to hold onto the funds or use them for another purpose.

“If we don’t need taxpayer money for that purpose,” Perry said, “let’s not collect it at all.”

Perry emphatically reiterated his longstanding position that Texas will not expand Medicaid or establish a health insurance exchange under the terms dictated by the Patient Protection and Affordable Care Act.

“Texas is not going to drive millions of dollars more into an unsustainable system, one that would drive Texas into bankruptcy,” Perry said.

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Contact Mark Lisheron at 512-299-2318 or mark@texaswatchdog.org or on Twitter at @marktxwatchdog.

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Photo of Texas state Capitol by flickr user Matt Rife, used via a Creative Commons license.

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