Bill > HB45

This bill establishes a joint interim committee to study the potential abolition of ad valorem taxes (property taxes) in Texas and explore alternative local revenue sources. The committee will consist of ten members - five representatives from the House and five senators, appointed by the House Speaker and Lieutenant Governor by February 1, 2026. The committee's comprehensive study will focus on how to replace local tax revenue lost by abolishing ad valorem taxes, specifically examining the feasibility of using local sales and use taxes. Their research will include determining appropriate sales tax rates for different political subdivisions, evaluating potential tax rate adjustments, investigating revenue redistribution mechanisms, and identifying implementation challenges. The committee must submit a detailed written report with findings and recommendations to the legislature by December 1, 2026. If a constitutional amendment to abolish ad valorem taxes is approved by voters, the bill stipulates that all property tax provisions in the Tax Code will be repealed, and ad valorem taxes will be prohibited statewide starting January 1, 2031, with existing tax liabilities remaining collectible under previous laws. The committee will be automatically dissolved on January 1, 2027, after completing its study and report.