| 1. |
The State of Texas cannot afford to lose billions of dollars in franchise tax revenue to pay for private school vouchers.
The state Comptroller of Public Accounts is projecting to collect about $3.9
billion in franchise taxes in 2002-2003. The franchise tax is the state’s
primary general business tax. A potential loss of significant franchise tax
revenue would reduce money available to fund needed services.
|
| 2. |
Franchise tax credits provide an incentive for supporting private K-12 education at the expense of public education.
Proposed tax credit schemes would allow a corporation to choose either: (1)
to pay its franchise tax to state government to support public schools and
other public purposes, or alternatively, (2) to pay the same amount to
support a private or religious elementary or secondary school. These schemes
effectively invite corporate taxpayers to redirect their tax money away from
public coffers to private schools.
|
| 3. |
Tax credits for private voucher programs use public funds to subsidize private schools.
Lobbyists for voucher franchise tax credits inaccurately maintain that such
credits do not involve public money. Legally and economically, however, tax
credits are public funds. When state government grants franchise tax credits,
it foregoes income. For every dollar credited to a taxpayer for contributions
to a private school voucher program, the State of Texas would lose a dollar
of tax revenue.
|
| 4. |
The true beneficiaries of voucher franchise tax credits would be private and religious schools.
While corporate taxpayers may get a franchise tax credit, the true
beneficiaries would be private schools. Tuition is the very “lifeblood” of
private education, and private academies would get a transfusion of money for voucher students while public schools would lose state funding as their
enrollments drop.
It should be expected that new, unproven for-profit private schools would be
opened just to take advantage of a pool of students with vouchers in hand.
These “pop-up schools” funded with public tax credits would not be
accountable to taxpayers for offering a quality educational program or for
appropriate use of public funds.
|
| 5. |
Private schools would become dependent on voucher income, threatening their viability.
Private schools would become dependent on an increased number of students
whose tuition was paid with vouchers funded by corporations. If a future
legislature abolishes a voucher franchise tax credit, then private schools
could lose a significant number of students and the schools might struggle or
have to close.
|
| 6. |
Private schools accepting vouchers funded with tax credits could
discriminate in admissions.
Franchise tax proposals would allow private and religious schools which
accept vouchers to discriminate in their admissions on the basis of religion,
prior educational performance, gender, English-speaking ability, citizenship,
and athletic ability. It would not be equitable public policy to support such
admissions practices with public money. “Choice” does not reside with
parents but with private school admissions committees who choose which
children to admit and which to reject.
|
| 7. |
Franchise tax credits for privately-funded vouchers transform charity into “corporate welfare.”
Voucher proponents in Texas have donated more than $50 million to
privately-funded voucher programs. If franchise tax credits were granted for
these contributions, such acts of charity would be transformed into
self-serving corporate welfare.
|
