WRITE TWO OR MORE WELL THOUGHT-OUT AND DEVELOPED PARAGRAPHS TO ANSWER THE QUESTIONS BELOW. BE SPECIFIC. Texas remains co

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WRITE TWO OR MORE WELL THOUGHT-OUT
AND DEVELOPED PARAGRAPHS TO ANSWER
THE QUESTIONS BELOW. BE SPECIFIC.
Texas remains committed to pay-as-you-go
spending and low taxes, no matter the strength of
the economy. Texans prefer regressive taxes,
which favor the rich and fall most heavily on the
poor, and Texas has one of the most regressive tax
structures in the nation. Texas relies heavily on
sales tax to finance services. A state income tax,
while more progressive, is unlikely to be enacted
because the state's constitution requires a
referendum passed by the people to enact such a
tax. Under the current structure, the part of the
economy generating the most revenue frequently
pays the least in taxes. Texas accounts for the
state's revenue in several different budgets: All
Funds Budget, General Revenue Funds Budget,
and General Revenue Fund. Dedicated funds can
only be used for a designated purpose
When revenue declines, elected officials will either
increase taxes or other sources of revenue, or
decrease services. Historically, the legislature's
favored response has been to decrease services
In fiscal years 2016-2017, sales tax accounted for
almost 60 percent of state tax revenue. Texas
collects two kinds of sales tax: general and
selective. Goods sold on the Internet and most
professional and business services are exempt
from the general sales tax. Selective sales taxes
are grouped into three categories: highway user
taxes, sin taxes, and miscellaneous sales taxes.
There are also general and selective taxes on
businesses. The severance tax levied on a natural
resource, such as oil or natural gas, when it is
removed from the earth is one of the most
important selective taxes on business. In addition,
a comparison of sales and use tax collections
($31.9 billion) and franchise tax collections ($3.
billion) for fiscal year 2018 reflects the extent to
which Texas persists in relying on sales tax revenue. Changes in the Texas economy, without
corresponding changes in its tax system, are
projected to continue to erode the tax base. Under
the current structure, the part of the economy
generating the greatest amount of revenue
frequently pays the least amount in Texas
Texas receives revenue from three types of
gambling operations: horse and dog racing, a
state-managed lottery, and bingo. Federal grants-
in-aid contribute more revenue to Texas than any
single tax levied by the state.
In Texas, the budget period covers two fiscal years.
There are two major entities involved in preparing
the budget: the Legislative Budget Board (LBB)
and the Governor's Office of Budget and Policy
(GOBP). Each entity prepares a budget;
historically, the legislature has preferred the budget
prepared by the LBB-composed of members of
the House and Senate. The comptroller provides a
revenue estimate and the legislature can only
spend in excess of the amount upon approval of
four-fifths of each chamber. For more than five
decades, Texas's proposed functional expenditures
have centered on public education, health and
human services, and highway construction and
maintenance. The comptroller is responsible for
maintaining a double-entry system in which a debit
account and a credit account are maintained for
each transaction.
QUESTION
1. Texas has a biennial (every two years)
legislative session and budget period. Do
you think that the economy fluctuates too
rapidly for this type of system to be
efficient? What are the advantages and
other disadvantages of Texas using a
biennial legislative and budget period?