Texas Legislature
9:53 am
Tue April 9, 2013

Is Increased Sales Tax The Answer To TxDOT Debt?

In order to curb the amount of debt owed by the Texas Department of Transportation, Sen. Kevin Eltife, R-Tyler, is proposing the state raise the sales tax by one-half cent.

"Over the past ten years a large part of funding for TxDOT projects has been done by issuing debt. TxDOT has outstanding debt exceeding $12 billion. If we continue down this path it will 2045 before all these bonds are paid off and it will cost the taxpayers about $28 billion including principal and interest," Eltife said.

Even though a sales tax increase may be hard to swallow,  he said it is more likely to pass by voters than other rate increase.

"Pick your poison," Eltife said. "I prefer consumption taxes - gas tax, sales tax, you pick it. I personally think sales tax is easier to swallow than gas-tax."

He said raising Texas' sales tax by one-half cent saves the state $6 billion and cuts TxDOT's debt down by 18 years. The bill was left pending in committee.