The Texas House of Representatives has unveiled a plan to lower the state’s property tax appraisal cap to 5%, which the House Speaker called the “largest property tax cut ever” in the state.
Lawmakers proposed the largest Texas property tax cut. (Photo: Texas Tribune)
Proposed Texas Property Tax Cut
House Bill 2 seeks to reduce the assessed value of homesteads and commercial properties, which will provide a significant benefit to property owners who have seen their property tax bills rise due to increasing property values. The Current Texas Property Tax Code limits increases in the total assessed value of a homestead to 10%. However, rising property values have resulted in higher tax bills for many Texans, even after a reduction in tax rates.
Speaker Dade Phelan announced the proposed legislation on Thursday, stating that it would go beyond homesteads and also reduce the cap on appraisal increases for commercial property. The announcement followed the filing of legislation by State Sen. Paul Bettencourt to increase the state’s homestead exemption from $40,000 to $70,000, according to a published article in Valley Central.
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What Will Happen if the Texas Property Tax Cut Is Passed?
The homestead exemption is the portion of a property’s value that is exempt from property taxes. Bettencourt said that the exemption increase would help control the growth of property tax bills, and in this case, actually reduce them for as long as homeowners own their properties in Texas.
Lt. Gov. Dan Patrick promised in his inaugural address that the Senate would pass legislation to increase the homestead exemption, and the bill reportedly enjoys unanimous support in the Senate, according to a published article in NBCDFW.
If passed, the legislation will require approval from Texas voters before the exemption increase can take effect. The new legislation is aimed at providing much-needed relief to property owners struggling with rising property taxes in the state. The Texas House of Representatives believes that reducing the cap on property tax appraisals to 5% will significantly ease the burden on Texans, and provide the largest property tax cut ever recorded in the state.
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