Texas House Bill HB2324

Texas 2013 - 83rd Regular

Caption

Relating to the calculation of penalty on a delinquent ad valorem tax.

Impact

If enacted, HB2324 would immediately influence the financial responsibilities of property owners and the collection processes implemented by local tax authorities. The reduced penalties on delinquent taxes could afford taxpayers additional time to settle their debts without incurring excessively punitive fees, thus potentially lowering the overall burden on individuals and businesses. However, local governments that rely on timely tax collection to fund public services might experience impacts on cash flow, which could affect their budgeting and financial planning.

Summary

House Bill 2324 is a legislative proposal aimed at amending the calculation of penalties associated with delinquent ad valorem taxes in Texas. The bill reduces the initial penalty for a delinquent tax from six percent to four percent during the first calendar month of delinquency. Furthermore, it establishes an additional penalty of one percent for each subsequent month the tax remains unpaid, maintaining a capped penalty of 10 percent for taxes that become delinquent as of July 1 of the respective year. This adjustment seeks to provide some relief to taxpayers facing financial difficulties during the initial delinquent period and over the subsequent months.

Contention

The primary points of contention surrounding HB2324 may arise among stakeholders involved in local tax revenue collection. Advocates for the bill, particularly those focused on taxpayer rights and fiscal relief, argue that lowering penalties can assist individuals who are struggling to comply with tax obligations. On the other hand, local government representatives may argue that leniency in penalty calculations could encourage late payments and undermine timely tax revenue collection, thereby hindering their ability to provide essential services to the community.