Big Tobacco Wants GOP To Break Tax Pledge

For a party that uses the elephant as their mascot some Republicans have a decidedly short memory when it comes to promises, while others seem to be more like donkeys in disguise than real pachyderms. “Read my lips: no new taxes.” That’s what George H.W. Bush said in 1988. He lost re-election in large part after breaking that promise. Now, Big Tobacco hopes Texas Republicans will break the pledge to hurt competitors.

Since 1986, more than 1,100 officeholders around the nation (including 67 in the Texas House) have signed the Taxpayer Protection Pledge — and, with only a few notable exceptions, they have kept that promise to their constituents.

Texans are on the verge of witnessing a pledge-break this week. And they are doing so in an effort to help Big Tobacco crush competitors for not being, well, Big Tobacco.

A decade ago, Big Tobacco settled a massive lawsuit brought by the states and agreed to a tax-hike funding health care initiatives. Since then, Big Tobacco has been frustrated that competitors — companies who weren’t sued — pay lower taxes. Do you hear the hypocrisy coming?

Well, Big Tobacco and a few lackey legislators have decided to impose a tax hike on small competitors in the name of “fairness” and — as one moderate GOPer calls it — a “level playing field.”

(You can always tell who the GOP moderates are: they’re the Republicans who define tax fairness in terms of higher taxes.)

Trying to be cute, State Rep. John Otto decided to call his tax a fee “on the sale, use, consumption, or distribution.” But if waddles and quacks, it is a duck. Remember, though, this isn’t a tax to fund health care — it’s a tax being levied so big-business can whack smaller competitors.

Realizing they have a problem on their hands with violating the Taxpayer Protection Pledge, Big Tobacco Republicans are running in two directions.

On the silly side is State Rep. Larry Gonzales (R-Round Rock), who distinguishes himself regularly by shilling for big spending on Hollywood subsidies. He nonsensically says the Taxpayer Pledge shouldn’t be considered in this case, because the “talks” to tax small companies started four years ago, before the pledge…


The pledge has been around since 1986 — which George H.W. Bush signed, and then broke.

Mr. Gonzales should know about the pledge’s history, since he made a big showing of signing it when running for office in 2010. Meanwhile, he claims everyone in the industry is OK with the tax hike. Which, of course, makes it OK to break the promise he made to voters.

The more intellectually honest legislators pushing the Big Tobacco agenda, say they would shift the dollars into the “property tax relief fund.”

Of course, that doesn’t amendment wouldn’t actually result in any property tax relief. That fund was established in 2006 so the Gross Margins Tax could push property tax rates down to a set rate. Any new monies don’t actually lower the tax.

As Grover Norquist of Americans for Tax Reform told me yesterday, that’s like selling the same horse twice.

Now, the Taxpayer Protection Pledge does allow for tax shifts, but it needs to actually be a real tax reduction — not a shell game.

Voting for HB3536 is a violation of the Taxpayer Protection Pledge. And, for that matter, a violation of the Texas GOP Platform, which says lawmakers should be about the business of “Reducing the overall tax burden.”

The House Republican Caucus policy committee voted to oppose the measure — but the Straus leadership team (of which Mssrs. Otto and Gonzales are tied at the hip), are pushing it anyway.

As Texas Public Policy Action put it, HB3536 is “is an unjustified expansion of government” that “imposes several new taxes… Non-settling manufacturers should not be burdened with fees simply because other manufacturers settled and are now at a competitive disadvantage.”

Here are the GOP legislators signed on with Mr. Otto and Mr. Gonzales to break faith with their party and do the bidding of Big Tobacco: Rep. Lois Kolkhorst, Rep. John Zerwas*, Rep. Trent Ashby, Rep, Myra Crownover*, Rep. Drew Darby, Rep. Dan Huberty*, Rep. Rob Orr, Rep. Bennett Ratliff, Rep. J.D. Sheffield.

(* = signed the Taxpayer Protection Pledge)

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ABOUT THE AUTHOR

Michael is president and CEO of Empower Texans. A graduate of Texas A&M, former newspaper reporter, one-time Capitol Hill staffer, think tank vice president, and an Eagle Scout, Sullivan is married with three children. He divides his time between the Metroplex, the rest of Texas, and Austin.

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