By: Vasut H.B. No. 64
A BILL TO BE ENTITLED
AN ACT
relating to the elimination of ad valorem taxes and the creation of
a joint interim committee on the elimination of those taxes.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. (a) Title 1, Tax Code, is repealed.
(b) Notwithstanding any other law, this state or a political
subdivision of this state may not impose an ad valorem tax. To the
extent of a conflict, this section controls over a conflicting
provision in a general or special law.
(c) The change in law made by this section does not affect
tax liability accruing before the effective date of this section.
That liability continues in effect as if this section had not been
enacted, and the former law is continued in effect for the
collection of taxes due and for civil and criminal enforcement of
the liability for those taxes.
(d) This section takes effect January 1, 2033.
SECTION 2. (a) In this section, "committee" means the joint
interim committee on the elimination of ad valorem taxes.
(b) The joint interim committee on the elimination of ad
valorem taxes is composed of:
(1) five members of the house of representatives
appointed by the speaker of the house of representatives; and
(2) five senators appointed by the lieutenant
governor.
(c) The speaker of the house of representatives and the
lieutenant governor shall make the appointments under Subsection
(b) of this section not later than March 1, 2024.
(d) The speaker of the house of representatives and the
lieutenant governor shall each designate a co-chair from among the
committee members.
(e) The committee shall convene at the joint call of the
co-chairs.
(f) The committee has all other powers and duties provided
to a special or select committee by the rules of the senate and
house of representatives, by Subchapter B, Chapter 301, Government
Code, and by policies of the senate and house committees on
administration.
(g) The committee shall conduct a comprehensive study of
alternative methods of taxation to replace local tax revenue that
will be lost when ad valorem taxes are eliminated.
(h) For each alternative method of taxation considered by
the committee, the committee shall:
(1) consider whether political subdivisions that
currently impose ad valorem taxes would have the authority to
impose the proposed alternative tax;
(2) determine the average tax rate for the proposed
alternative tax imposed by each type of political subdivision that
would be necessary to generate the same amount of tax revenue as the
amount of tax revenue lost as a result of the elimination of ad
valorem taxes;
(3) determine, if appropriate, the effect that
broadening the application of the proposed alternative tax at the
local level would have on the tax rates identified under
Subdivision (2) of this subsection;
(4) identify whether tax revenue generated by the
proposed alternative tax would require redistribution to offset
disparities in available local tax revenue as a result of the
elimination of ad valorem taxes and, if so, evaluate the different
mechanisms of redistribution available; and
(5) identify and examine any other issue that would
need to be addressed to implement the elimination of ad valorem
taxes.
(i) On request of the committee, a state agency or political
subdivision shall provide information for and assistance in
conducting the study under this section.
(j) Not later than November 1, 2024, the committee shall
prepare and submit to the legislature a written report containing
the results of the study and any recommendations for legislative or
other action.
(k) The committee is abolished and this section expires
January 1, 2025.
SECTION 3. Except as otherwise provided by this Act, this
Act takes effect February 7, 2024.