Texas Senate Bill SB763

Texas 2015 - 84th Regular

Caption

Relating to the exemption from ad valorem taxation of certain income-producing tangible personal property.

Impact

The bill has implications for small businesses particularly. Business owners whose tangible personal properties fall below the exemption threshold can significantly reduce their administrative burden regarding property tax assessments. Moreover, by raising this threshold, the legislation aims to encourage entrepreneurship and economic growth in Texas by reducing the tax liability for smaller enterprises, which typically have fewer resources to allocate towards property tax compliance.

Summary

SB763 addresses the regulation of ad valorem taxation concerning certain income-producing tangible personal property. Specifically, it amends provisions in the Texas Tax Code to increase the exemption threshold from $20,000 to $50,000. This means that if the total value of the income-producing tangible personal property is considered less than $50,000, property owners are required to file a simplified rendition statement with limited information.

Contention

Notably, there may be points of contention regarding the bill's impact on local revenue streams, especially for counties and municipalities that rely on property taxes for funding essential services. Critics might argue that increasing exemptions for income-producing properties could limit the overall tax base and thus affect local governmental budgets. Additionally, stakeholders may raise concerns about how such exemptions could be unfairly advantageous to larger firms managing multiple properties well above the exemption threshold.

Implementation

SB763 is designed to come into effect starting January 1, 2016, contingent upon the approval of a concurrent constitutional amendment authorizing such exemptions. This conditionality means that the practical application of the bill is tethered to public endorsement of the associated amendment, making voter sentiment on the issue particularly pivotal.