Constitutional amendment for sales tax to fund K-12 education
If passed, HB 507 would amend Article VIII, Section 16 of the Montana Constitution. This change would require that the dedicated net revenue from the proposed state sales tax primarily be used to lower property taxes that support public education. The aim of this bill is to shift part of the funding responsibility from property owners to a broader sales tax base, potentially alleviating the financial burden on homeowners while ensuring stable funding for K-12 education.
House Bill 507 proposes an amendment to the Montana Constitution that aims to establish a 4% sales and use tax specifically designated to reduce property taxes that fund K-12 education. The bill seeks to provide a new revenue stream to support educational funding, addressing concerns regarding the sustainability of property tax-based funding for schools. The proposed tax would only be implemented should the electorate choose to approve the amendment in the upcoming general election in November 2026.
The sentiment around HB 507 includes a mix of support and opposition. Proponents argue that implementing a sales tax allows for a more equitable tax structure that could lessen the dependency on property taxes, which disproportionately affect homeowners. They highlight the importance of stable funding for education and hope that this new measure can enhance educational resources. Conversely, opponents may express concerns regarding the introduction of a sales tax and how it might impact lower-income families, suggesting that a sales tax could be regressive.
Notable points of contention regarding HB 507 may stem from the implications of changing Montana's constitutional approach to tax revenue. Opponents may worry about precedents set by constitutional amendments related to taxation and how it could open the door for further tax changes in the future. Additionally, the timing of voter approval in 2026 might raise concerns about education funding sufficiency before the new tax potentially takes effect, complicating budget planning for schools relying on current property tax systems.