Texas Lawmakers Advance Property Tax Relief Legislation | Texas
(The Center Square) – Although Texans pay no state income tax, if they own property, they currently pay the sixth highest effective property tax rate in the country.
Tories and the Texas Republican Party have consistently complained that the Republican-led legislature failed to adequately address one of the most pressing issues facing Texans: property tax relief.
Property tax relief was not listed as an emergency piece of legislation by Governor Greg Abbott during the first two special legislative sessions he called this year, after the regular session had not addressed the issue. Some Republican lawmakers argue the state needs to fix this and have introduced three property tax relief bills during the third Special Legislative Session, which is underway, with input from the Texas Public Policy Foundation. .
The TPPF says its proposals, if implemented, would eliminate all property taxes in Texas by 2033.
Earlier this year he offered his “Less taxes, better Texas“plan. In a summary, TPPF argues that property taxes can be eliminated over time by using excess government revenue to reimburse local school taxes. Taxes from public school districts make up the largest portion of property tax bills. A new tax structure, if implemented, would shift towards financing local governments primarily through sales tax revenues.
The proposal “would eliminate property taxes for every Texan by 2033 or sooner, while making structural changes to the system that would prevent annual increases in tax bills and curb irresponsible local governments.”
“Texans will never experience the peace of mind that comes with owning their home until property taxes are eliminated,” said Vance Ginn, chief economist at TPFF. “Until then, Texans are just renting their homes from the government, still with the fear that taxes could become so outrageous they can’t afford to stay.
The Tax Foundation based in Washington, DC Remarks that the Texas tax structure relies heavily on property taxes instead of other broad categories of taxes, such as having no personal income tax. “This often implies a greater devolution of power to local governments, which are responsible for more government services than they are in states which are more dependent on state revenues,” says the foundation.
One way to help reduce property taxes is to cut government spending, which the legislature addressed this year.
A new law that came into effect on September 1, tabled by Sen. Kelly Hancock, R-Dallas and many others, restricts state spending by tying it to population growth and inflation.
“The current constitutional spending limit only includes state tax revenues not devoted by the constitution, which is not a faithful representation of our state spending,” says analysis of the bill . The bill “seeks to remedy this by creating an additional spending limit” for general consolidated revenue credits “and places restrictions on the amount of credits from these funds based on population and inflation.”
TPPF’s proposal recommends that any surplus in government general revenues exceeding the new cap be used to first reduce school maintenance and operating (M&O) taxes, which it says have become de facto a statewide property tax. This will provide relief to taxpayers and also comply with the constitutional requirement to fund public schools.
In addition to spending restraint and restructuring, three new bills have been introduced and are making their way through the legislative process.
State Senator Paul Bettencourt, R-Houston, introduced SB 1, and Rep. Tom Oliverson, R-Cypress, introduced HB 90. They would reduce school district M&O taxes by using excess dollars from the State to replace local tax dollars, in accordance with TPPF recommendations.
Senate Bill 1 proposes a one-time buyout of the M&O tax rate for the 2022-2023 school year of at least $ 2 billion and up to $ 4 billion, depending on the surplus estimate of the State Controller. If implemented, it would save the average Texas homeowner between $ 200 and $ 400. The Senate passed the bill by a 30-1 vote last month. The bill has been referred to the House and is pending in committee.
House Bill 90 would provide permanent property tax relief by applying 90% of all state surpluses each year to reduce M&O school taxes. As of September 30, the bill is pending in committee.
State Representative Andrew Murr, R-Junction, also introduced Bill 91, which would create a committee to study a new tax model.
At a recent House Ways and Means Committee hearing on HB 90 and SB 1, Oliverson said the key issue voters asked him to address when he ran for office was the relief of the property tax.
“One of the main reasons I was sent here by people back home is to do something about property taxes,” Oliverson said. “It’s taxpayers’ money. We’ll give it back to them first.
Dale Craymer of the Texas Taxpayers and Research Association testified at the hearing, “It doesn’t take money away from any part of the budget. We are talking about sauce, not meat and bone.
Ginn, who spoke on the two bills, stressed that the proposals “are not about funding education.” Public education is always fully funded, the difference is that Texans get property tax relief. “This is what the Texans want,” he said.