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Property Tax Bills Pre-Filed in Texas Legislature

by Ken Parsons, Senior Vice President, December 2014


Even before the Texas Legislature officially convenes, it's obvious that tax reform will be a major issue in the upcoming session. Two property tax bills have already been pre-filed for the 84th Regular Session that begins January 13, 2015.


One bill seeks to repeal the Texas margins tax. The other mandates a local tax rate election when property tax revenues grow more than 4% from the previous year.


Senate Bill 105


SB 105 eliminates Texas' business tax, also known as the margins tax or franchise tax.


"Creating the margins tax was a huge mistake," said sponsor, State Senator Craig Estes. "It is inequitable, burdensome, complicated, and increases prices for consumers while decreasing wages for workers. The margins tax is anti-business, anti-worker, and anti-consumer. It is time the Legislature corrected its mistake and repealed the tax once and for all by passing Senate Bill 105."


Estes added that repealing the margins tax would supercharge the Texas economy. He noted the Tax Foundation estimated that repealing the margins tax would move Texas' corporate tax ranking from 38th to first in the nation. If approved by the Legislature, SB 105 would take effect in 2016.


Senate Bill 182


SB 182 requires a tax rate election if any city, county, or special district property tax revenues grow by more than 4% from the previous year, excluding new construction.


Sponsor of the bill, Senator-Elect Paul Bettencourt explained, "As property values go up, tax rates rarely go down. The result is that property tax bills can soar by nearly 10% or more a year, which is at least twice as fast as most Texan's paychecks."


Bettencourt, a former Harris County Property Tax Assessor/Collector, said he plans to file additional property tax relief legislation as the session approaches.