The Libertarian Party of Texas (LPTexas) tentatively supports Senate Bill 1337, which ensures that tax penalties and interest are calculated based on a taxpayer’s net balance—after deducting any overpayments made for the same tax type. This bill is a step toward limiting unjust taxation practices and enforcing government accountability.

Promoting Fairness in Tax Administration
SB 1337 prevents the state from penalizing or charging interest on tax amounts that were effectively prepaid. LPTexas believes individuals should never be punished for overpaying or making good-faith errors, and this bill helps close a loophole that previously allowed the state to profit from such discrepancies.

Holding Government to a Higher Standard of Accounting
Just as individuals and businesses must operate with accurate financial records, so too should the government. This bill reinforces the principle of honest bookkeeping—netting out overpayments against liabilities—ensuring that penalties and interest apply only to true tax debts, not accounting inconsistencies.

Opposing Interest on Coerced Payments
LPTexas maintains that taxation is inherently coercive—taking from individuals under threat of penalty. If such taxes are to be levied at all, it is especially egregious for the government to demand interest on balances that are, in many cases, technical or temporary. SB 1337 pushes back on this predatory practice and reasserts that the government should not profit from its own poor accounting or ambiguous tax rules.

Conclusion
The Libertarian Party of Texas urges the Legislature to pass SB 1337. While LPTexas ultimately seeks to end coercive taxation, we support this practical reform to limit the scope of government abuse and protect taxpayers from unfair financial penalties. A just system should never charge interest on money it was never rightfully owed.