In today’s article on the 14 proposed amendments to the Texas Constitution, we’ll look at Proposition 3, which prohibits the State Legislature from placing Taxes on Wealth or Net Worth. Here is how Proposition 3 is written on the ballot, “The constitutional amendment prohibiting the imposition of an individual wealth or net worth tax, including a tax on the difference between the assets and liabilities of an individual or family.”
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Breaking Down Proposition
Proposition 3 would add language to the Texas Constitution to prohibit the state legislature from imposing a tax based on an individual’s or family’s wealth or net worth. As of 2023, no state had adopted a wealth tax. In 2019, Texans approved Proposition 4 prohibiting the state legislature from adopting a state income tax.
Background to Proposition 3
As of 2023, Texas is one of eight states without a personal income tax. The eight states have no personal income tax, including Alaska, Florida, Nevada, South Dakota, Tennessee, Texas, Washington, and Wyoming. Texas had never levied a tax on personal income. The other 42 states collect a state income tax in addition to the federal income tax, which is filed when federal income tax is.
In 2019, Texans approved Proposition 4 with 74% of the vote to prohibit the state from levying an income tax on individuals to the Texas Constitution, which requires a two-thirds legislative vote and a statewide referendum to amend. Before Proposition 4, the state constitution required the state legislature to put legislation enacting an income tax before voters as a statewide referendum, which voters could approve or reject. Placing a referendum before voters required a simple majority vote (50%+1) in each legislative chamber.
The first state to enact a personal state income tax was Wisconsin in 1911. Hawaii enacted an income tax in 1901, which was before Wisconsin, but Hawaii was not a US state until 1959. The most recent state to enact a personal state income tax was New Jersey in 1976. The federal government enacted a federal personal income tax in 1913.
State Rep. Cole Hefner (Republican of House District 5) was the primary sponsor of the amendment. All Republican legislators voted in favor of the amendment. In the upper chamber, 19 Republicana and 3 Democrats voted in favor and 9 Democrats voted no. In the lower chamber, 85 Republicans and 16 Democrats voted yes and 45 Democrats voted no.
If the the proposition measure passes then there would be a Section 25 added to Article 8 of the Texas Constitution with following underlined text written: “Sec. 25. The legislature may not impose a tax based on the wealth or net worth of an individual or family, including a tax based on the difference between the assets and liabilities of an individual or family.”
A “YES” vote supports amending the Texas Constitution to prohibit the Legislature from enacting a wealth or net worth tax in the future.
A “NO” vote opposes amending the Texas Constitution to prohibit the Legislature from enacting a wealth or net worth tax in the future.
Disclaimer: TownTalk does not support or endorse a “YES” or a “NO” to these propositions. The information provided in this article is for informational purposes only.
