Updated Wednesday at 3:40 p.m. to include committee testimony.

AUSTIN — A plan to increase Texas’ sales tax as a means of lowering property taxes — touted by the state’s three most powerful Republican leaders as a priority — has been under attack since the moment it was announced last week.

Predictably, Democratic leaders rushed to criticize the policy for punishing the state’s poorest families. But some of the most intense opposition has come from conservatives, who are asking why Republicans would champion a plan to increase taxes.

A House committee on Wednesday heard House Joint Resolution 3 by Rep. Dan Huberty, R-Humble, which would increase the state sales tax by an additional cent to generate about $5 billion for the two-year budgeting period. Eighty percent of the dollars generated by the tax hike would go toward lowering school property tax rates — by about 15 cents per $100 of taxable value — and the other 20 percent of new revenue would be earmarked for school funding.

Anti-tax conservatives said every dollar of new sales tax raised should go toward lowering property taxes rather than be used for more school spending.

But Huberty said his bill lowers property taxes and gives school districts dedicated state dollars that will reduce how often they hike local taxes. Dallas ISD last November passed a 13-cent property tax rate increase for school funding, which generates an extra $126 million a year.

"Our question is how do we find ongoing, lasting property tax relief, and at the same time, reduce the state's reliance on property taxes to fund schools," Huberty told the House Ways and Means committee. "Texans are tired of their property taxes funding the biggest portion of public education."

Huberty also said the sales tax swap plan builds on the House's school finance legislation, which pumps $6.3 billion of new money into public education and increases per-student funding for every school district in Texas. That bill, which already passed the House, promises to increase the state's minimum per-student funding from $5,140 per student to $6,030 per student.

If the Legislature also passes the sales tax swap bill, the per-student funding would bump up to $6,224.

The school finance bill would give Plano ISD an additional $640 per student, and the sales tax swap would bump that to $850. For Frisco ISD, it would be $438 and $858 per student, Huberty said.

The combination of both bills would lower the school tax rate in Plano and Frisco from $1.17 per $100 of taxable value to 94 cents.

Huberty's bill is a constitutional amendment, which requires a two-thirds vote of the Legislature, rather than a simply majority, as well approval from voters in November.

The committee did not vote on the resolution Wednesday.

GOP critics

Last week, Republican Gov. Greg Abbott, Lt. Gov. Dan Patrick and House Speaker Dennis Bonnen released a joint statement supporting the sales tax increase as a means of giving Texans additional property tax relief.

Conservatives have expressed dismay about the optics of a tax increase pushed by Republicans.

“Such a tax swap would result in a harmful net tax hike at a time when the state already has a budget surplus,” anti-tax advocate and founder of Americans for Tax Reform Grover Norquist wrote to members of the Texas House Ways and Means committee about Huberty's bill.

Increasing the 6.25% sales tax a penny to 7.25% would tie Texas with California for the highest state rate in the nation. Local governments can levy up to 2 more pennies, which means most Texans pay about 8.25% in sales tax.

Houston Sen. Paul Bettencourt, chairman of the Senate Republican Caucus and a longtime property tax relief advocate, said he doesn’t “think there’s an appetite for this” in the Senate.

He said the Texas Legislature tried a swap years ago, increasing the state's franchise tax for businesses while lowering property taxes. But, he said, property taxes crept up anyway.

Bettencourt said a "palatable" tax swap would have to be revenue neutral, meaning that every dollar of sales tax raised would have to be applied toward lowering property taxes. HJR 3 does include some additional funding for increased spending on schools.

Former Irving Rep. Matt Rinaldi, who was a member of the conservative Freedom Caucus in the House, said he doesn’t understand what his former Republican colleagues are doing.

“I truly think it’s unfathomable that we’re proposing raising taxes,” he said.

Rinaldi said Republicans conceded too much for school funding in budget negotiations and ended up without enough money left to fund property tax relief. The House budget includes $6.3 billion in new money for public education and $2.7 billion for property tax relief.

“Meaningful property tax relief doesn’t come from raising taxes. It comes from using the $9 billion surplus for property tax relief,” he said.

Vance Ginn, an economist with the Texas Public Policy Foundation, a conservative think tank, said his organization supports conceptually what Abbott, Patrick and Bonnen have called for — raising sales taxes to reduce property taxes.

But as written, they oppose Huberty’s bill because it's "growing government" and calls for increased spending.

Democratic reasons

Democrats also strongly oppose increasing Texas’ sales tax, but for different reasons.

"Raising the sales tax is dead wrong," Texas Democratic Party chairman Gilbert Hinojosa said in a written statement. "Once again, Republicans are lining the pockets of the wealthy few at the expense of hardworking Texans."

He added that Democrats would "fight tooth and nail against any Republican attempts to raise the sales tax."

But at least one Democrat on the Ways and Means committee said she'd vote in favor of it.

"I couldn't support it more," Rep. Sheryl Cole, D-Austin, told Huberty, noting that she likes that voters will get the final say.

The left-leaning Center for Public Policy Priorities estimates that only 20 percent of Texas families would save money from the sales tax swap.

"The sales tax takes the most from Texans who have the least, placing extra barriers in front of families working toward the middle class," Dick Lavine, CPPP senior fiscal analyst wrote in a blog.