Perry: TX Businesses To Get Tax Break In ’08

AUSTIN, TX — A strong economy and low unemployment rate will allow state officials to give businesses more than $90-million dollars in tax cuts, Gov. Rick Perry announced.

Perry said the tax cuts will help more than 370,000 businesses. “I believe in truth-in-budgeting. When the government levies a tax and collects more money than is needed, we must either stop collecting the tax, return the money or both,” he said.

In 2007, Texas created more jobs than any other state in the nation, resulting in record-low unemployment. As a result, he state collected more money than it needed for the unemployment trust fund in 2007. “I’m directing the state to bring the unemployment tax to a screeching halt for this year,” he said.

The Texas Workforce Commission (TWC) approved the suspension of the tax after reviewing employment figures and economic forecasts for the state.

The agency determined there were sufficient reserves to meet unemployment obligations for 2008. The tax cut will come in the form of a one-year suspension of the Unemployment Insurance (UI) replenishment tax, officials said.

In addition to the one-year suspension of the replenishment tax, TWC will continue to distribute the surplus tax credit to qualifying employers who file quarterly unemployment tax reports and owe UI taxes.

Officials said they will receive the surplus tax credit after their first quarter 2008 tax returns are filed and taxes are paid.