Texas Senate Bill SJR35

Texas 2015 - 84th Regular

Caption

Proposing a constitutional amendment authorizing the legislature to exempt from ad valorem taxation by one or more political subdivisions tangible personal property used by the owner of the property to manufacture, process, or fabricate tangible personal property for ultimate sale.

Impact

If enacted, SJR35 would make a significant change to the existing tax framework at the local level. By allowing exemptions for tangible personal property used in manufacturing, the amendment aims to encourage economic development and investment in Texas's manufacturing sector. This could lead to increased job creation and a more competitive market environment for businesses engaged in similar activities. However, it may also have implications for local governments that rely on property taxes as a primary revenue source, potentially affecting their budgets and service delivery.

Summary

SJR35 proposes a constitutional amendment that would empower the Texas legislature to exempt certain tangible personal property from ad valorem taxation by political subdivisions. This exemption would apply specifically to property that is utilized by its owner for the purposes of manufacturing, processing, or fabricating tangible personal property intended for ultimate sale. The intent behind the bill is to potentially enhance the business climate for manufacturers in Texas by reducing their tax burden on equipment and inventory involved in production processes.

Contention

While proponents of SJR35 argue that this measure will stimulate economic growth and attract businesses to Texas, there are concerns regarding the potential loss of local revenue due to the tax exemptions. Critics may argue that the amendment could disproportionately benefit larger corporations while disadvantaging smaller local businesses that may not have the same level of resources. Furthermore, the amendment raises questions about local control over taxation and the ability of political subdivisions to make financial decisions that best meet their community's needs.