SHERMAN, Tex. -- Business owners in the state of Texas will soon be affected when a current tax law will expand starting at the first of the year.
Texas Legislators have reformed and expanded the franchise tax to become the new margin tax. Attorneys say loopholes in the old franchise tax allowed some businesses to get out of paying it. The new tax will include all modified gross receipts instead of only taxable capital and earned surplus. The margin tax will affect all Texas businesses.
Jennifer Patterson, an Austin attorney who works for legislation reform, helped create the new margin tax. She was in Sherman on Wednesday to present information to business owners and answers any questions they had.
"The old franchise tax had problems, specifically it was easy to circumvent. There was a negative impact to the state's revenue," Patterson said.
The new tax law is expected to affect 200,000 additional businesses.