Bill > HB265

This bill establishes a joint interim committee to study the comprehensive elimination of ad valorem taxes (property taxes) in Texas, with significant long-term implications. The committee will consist of ten members - five from the Texas House of Representatives and five senators - appointed by the House Speaker and Lieutenant Governor by January 1, 2026. The committee's primary mandate is to conduct an in-depth study of alternative taxation methods that could replace the local tax revenue currently generated by property taxes. This study will require the committee to analyze potential alternative tax methods, including assessing their feasibility for local governments, determining the tax rates needed to maintain current revenue levels, evaluating potential redistribution mechanisms to address revenue disparities, and identifying implementation challenges. The committee is required to submit a detailed written report with findings and recommendations to the legislature by November 1, 2026. Critically, the bill also stipulates that all property tax provisions in the Texas Tax Code will be repealed, and ad valorem taxes will be prohibited statewide effective January 1, 2035, though the committee will be dissolved on January 1, 2027. The proposed changes would not affect existing tax liabilities accrued before the effective date, ensuring a smooth transition.

https://capitol.texas.gov/BillLookup/History.aspx?LegSess=891&Bill=HB265