SALT Report 2382 – Texas Governor Rick Perry has announced a four-point plan that he says will provide nearly $1.6 billion in tax relief to businesses currently subject to the state’s franchise tax. The Governor’s plan will reduce business taxes by:
- Reducing the franchise tax rates by 5%,
- Providing a $1 million deduction for businesses with annual revenue of up to $20 million,
- Lowering the rate for EZ Form filers, and
- Allowing companies who relocate to Texas a one-time deduction of moving expenses on their first franchise tax payment
Governor Perry also proposes to make the current small business tax exemption permanent as it impacts more than 29,000 businesses and is set to expire in 2014. Currently, businesses with $1,030,000 or less for franchise tax reports originally due on or after January 1, 2012, and before January 1, 2014, are exempt from paying the franchise tax. However, that threshold will be lowered to $600,000 or less for franchise tax reports due on or after January 1, 2014.
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