The Texas House unanimously approved a property tax relief package, advancing two Senate bills on Tuesday that would increase property tax exemptions and lower tax bills for Texans.
Senate Bill 4 would raise the homestead exemption for most homeowners from $100,000 to $140,000, and Senate Bill 23 would increase the exemption for elderly or disabled homeowners from $10,000 to $60,000.
The bills, key components of a deal brokered by Republican legislative leaders, aim to lower tax bills for Texans, who face some of the highest property taxes in the nation, according to The Texas Tribune.
Both bills, authored by Sen. Paul Bettencourt (R-Houston) and carried in the House by Rep. Morgan Meyer (R-Dallas), chair of the Ways and Means Committee, require a final House vote Wednesday before heading to Gov. Greg Abbott’s desk. If signed, the homestead exemption increases must be approved by voters in November to amend the Texas Constitution.
The package also includes House Bill 9, which raises the business personal property tax exemption from $2,500 to $125,000. The Senate approved the measure last week, and the House finalized it on Monday. This exemption applies to taxes levied by school districts, cities, and counties on business inventory, a tax Texas imposes, unlike most states.
Rep. Mike Olcott (R-Aledo) proposed an amendment to SB 4 to increase the homestead exemption to $160,000, citing the state’s $24 billion surplus.
“I refuse to go back to my district and say the best we can do is $6.5 billion in newly appropriated money from our $24 billion surplus,” Olcott said, as reported by Texas Scorecard. “My amendment will allow for a greater amount of that money to be used for property tax relief.”
Meyer urged rejection of the amendment, warning it would disrupt the negotiated deal with the Senate and require budget cuts elsewhere. A 96-35 vote tabled the amendment.
The package falls short of Gov. Abbott’s $10 billion tax relief goal set in his State of the State address. Lawmakers plan to spend $51 billion on property tax cuts over the next two years, raising concerns among budget watchers about long-term affordability.
A Zillow estimate cited by the Tribune indicates that a homeowner with a $302,000 home—the 2024 Texas average—would have saved over $500 on school taxes last year with the $140,000 exemption and proposed $3 billion in school tax rate cuts.
Unlike 2023, when House and Senate leaders failed to agree on tax cuts, forcing Abbott to call two special sessions, lawmakers are on track to pass this legislation before the session ends in June.