From the Office of State Senator Troy Fraser
For Immediate Release
January 13, 1999
Contact: William A. Scott - (512) 463-0124
FRASER PROPOSES FRANCHISE TAX CUT FOR SMALL BUSINESS
AUSTIN -- State Senator Troy Fraser, R-Marble Falls, today filed legislation that would eliminate the corporate franchise tax for an estimated 45,000 small businesses in Texas.
Under Senate Bill 148, businesses with annual gross receipts of less than $200,000 would be exempt from the tax and from filing annual reports with the Comptroller's Office.
"Small businesses in Texas operate on small profit margins, so every dollar counts," Fraser said. "It makes no sense to start a small business in Texas and then have to spend as much as $500 to hire someone to fill out a franchise tax form when the actual tax payment may only be about $100," Fraser said. "This bill, quite simply, is about job growth."
"By eliminating the reporting requirement, and the expenses that go with it, these 45,000 small businesses will be able to use that money elsewhere to grow their businesses," Fraser said.
Similar legislation will be carried by in the Texas House by Representative Tony Goolsby, R-Dallas. The legislation is endorsed by the National Federation of Independent Businesses.
Eliminating the small business tax in Texas will also provide an incentive for more business start-ups and make the state more competitive with other states in attracting and retaining business, Fraser said.
"All of us know that the growth engine for Texas over the last five years has been the larger technology companies," Fraser said. "If we are to continue that growth, it has to come from individuals stepping forward to form small spin-off businesses."