Texas House Bill HB5013

Texas 2023 - 88th Regular

• Filed: 3/10/23

Caption

Relating to an exemption from ad valorem taxation of 50 percent of the appraised value of the residence homestead of a person who has received a residence homestead exemption on the property for at least the preceding 10 years.

Impact

Should HB 5013 be enacted, it would directly impact the financial obligations of qualifying homeowners by substantially lowering their property tax liabilities. This could provide significant relief for residents, particularly those on fixed incomes or within lower income brackets, potentially allowing them to save or redirect funds to other essential needs. Furthermore, the bill's implementation may lead to a decrease in overall property tax revenue for local government entities, prompting them to reassess budget allocations or find alternative funding sources to cover the shortfall created by these exemptions.

Summary

House Bill 5013 proposes a significant amendment to the Texas Tax Code, specifically addressing ad valorem taxation. The bill introduces a provision that allows for a 50 percent exemption from the appraised value of a residence homestead for individuals who have held a residence homestead exemption on the property for at least the preceding ten years. This amendment aims to provide long-term homeowners with fiscal relief, recognizing their commitment to property ownership over a decade or more. The bill specifies that this exemption will take effect from the 2024 tax year, pending approval from voters on a related constitutional amendment.

Sentiment

The sentiment surrounding HB 5013 appears generally favorable among certain groups, particularly those advocating for property tax relief. Supporters argue that the bill acknowledges and rewards long-term homeowners, fostering community stability and financial security. However, there are also concerns voiced by local government representatives and fiscal conservatives who argue that the bill could shift the tax burden to other taxpayers and undermine the ability of local governments to adequately fund essential services, potentially impacting education, infrastructure, and public safety.

Contention

Notable points of contention revolve around the bill's fiscal implications, as well as the requirement for voter approval of the related constitutional amendment. Critics highlight the potential for decreased funding for local services that could arise from reduced tax revenues. They express concerns that the bill may disproportionately benefit wealthier homeowners who can afford to retain their properties over ten years, while failing to address the challenges faced by lower-income residents in the housing market. The debate underscores the tension between providing tax relief to homeowners and ensuring adequate fiscal resources for community needs.

Texas Constitutional Statutes Affected

Tax Code

• Chapter 11. Taxable Property And Exemptions
  • Section: New Section

• Chapter 26. Assessment
  • Section: New Section
  • Section: 112