(The Center Square) – The Texas Senate on Wednesday unanimously passed two property tax relief bills with bipartisan support.
They passed Senate Bills 2 and 3, Property and Franchise Tax Relief, filed by Sen. Paul Bettencourt, R-Houston, after Lt. Gov. Dan Patrick announced Monday that the Senate and House had reached a deal to provide $18 billion in property tax relief after seven months of stalemate.
After the bills’ passage, Lt. Gov. Dan Patrick said, “I have been fighting for property tax relief at the Texas Capitol since 2003, 4 years before I was elected to the Senate, and I have not stopped since then. When I took office as Lt. Governor in 2015, the homestead exemption was $15,000, and my goal was to increase it to $100,000. In 2015, we increased it to $25,000. In 2021, we increased it to $40,000. This session, our record budget surplus gave us the opportunity to increase the homestead exemption to $100,000.”
He also said unanimously passing SB 2 was historic because it is “the largest property tax cut in Texas history, and likely the world.”
SB 2 increases the homestead exemption to $100,000 for homeowners under age 65 and to $110,000 for homeowners over age 65. With an average home value of $330,000, he said the homeowner living in that home will receive a yearly permanent tax cut of between $1,250 and $1,450 “as long as they live in a homestead property. Over the life of a typical 25-year mortgage, homeowners could save between $25,000 and $30,000.”
“According to the Texas Taxpayers and Research Association, the average home value in 397 of the state’s 1,014 school districts is less than $100,000, meaning that with the increased homestead exemption passed in SB 2, homeowners with a home value of $100,000 and under would no longer pay school property taxes,” he added.
“In addition, during the regular session, I also prioritized giving relief to small and mid-sized businesses,” Patrick said. SB 3 does this by increasing the threshold before small businesses are required to pay and file franchise taxes. Roughly 67,000 small businesses “will no longer be burdened by the franchise tax all together so our businesses can continue to grow jobs and power the Texas economy forward,” he said.
Patrick also thanked House Speaker Dade Phelan and the Texas House for expressing support for the bills. The House is expected to pass both on Thursday morning. Gov. Greg Abbott has said he will sign them into law. The bills could be sent to his desk as early as Thursday afternoon.
Sen. Bettencourt said on the Senate floor before the bills’ passage, “I cannot tell you the joy that I feel, that for 20 years many people, and a growing number in the last decade, and in the last five years, and the last five months, and the last five days, have come to realize what a fantastic package this is. I saw in a headline in a national publication that says, ‘there’s one state that’s doing a $18 billion property tax reduction and it’s the state of Texas.’
“We can be proud that … we are … voting on an astounding $18 billion property tax cut, which is the largest in the state’s history, but apparently Texas-sized nationally. Because that’s what we do in Texas. We come up with Texas-sized solutions to challenges.
“For every homeowner in the state they are going to get a 41.5% reduction in their tax bill this November. That’s never happened anywhere in the country that we can find.”
This article First appeared in the center square