NEWS RELEASE
From the Office of State Senator Rodney Ellis

For Immediate Release
March 31, 1999
Contact: Jeremy Warren, (512) 463-0113

Senator Ellis' $250 Million Sales Tax Cut Plan Clears Senate Hurdle
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Finance Committee Approves SB 441 to Provide Sales Tax Relief to Texas Families

(Austin)// The Texas Senate Finance Committee today approved legislation by Senator Rodney Ellis (D-Houston), that will provide $250 million in sales tax relief to Texas' working families.

By a vote of 11-0, the Finance Committee approved SB 441, which will expand the current tax exemption on prescription drugs to over-the-counter children's medicines, exempt diapers from sales taxes, and create a 14-day sales tax holiday in August on shoes and clothing to help Texas families prepare their children for school. The price tag is $250 million over the biennium.

"Despite our growing economy, too many hard-working Texas families are struggling to make ends meet," said Senator Ellis. "This plan cuts taxes on the essentials all families must purchase, putting more money back in the pockets of all Texans."

SB 441 will:

The legislation is similar to proposals made by Governor George W. Bush during the 1998 Gubernatorial campaign. During the campaign, Governor Bush called sales tax relief "a direct way to return money to Texas families."

"Texas' sales tax rate takes the most from those who can least afford it," said Senator Ellis. "Our plan will provide tax relief to all Texans, but particularly those most in need. It could mean a month of free diapers, or a free pair of shoes for a child. That's a real tax cut Texas families can feel and understand."

At 8.25 percent, Texas has one of the highest combined sales tax rate in the nation. According to the Citizens for Tax Justice, Texas has the third most regressive tax system in the nation. High sales taxes hit low income and elderly Texans hardest, forcing our poorest citizens to pay up to six times more of their income in sales taxes than more affluent Texans.

SB 441: FAST FACTS

SB 441 cuts sales taxes by $250 million over the biennium. It will:

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