LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE, 89TH LEGISLATIVE REGULAR SESSION April 9, 2025 TO: Honorable Joan Huffman, Chair, Senate Committee on Finance FROM: Jerry McGinty, Director, Legislative Budget Board IN RE: SB2020 by Campbell (Relating to the exclusion of real property repair and remodeling services from sales and use taxes.), As Introduced Estimated Two-year Net Impact to General Revenue Related Funds for SB2020, As Introduced: a negative impact of ($917,470,000) through the biennium ending August 31, 2027. General Revenue-Related Funds, Five- Year Impact: Fiscal Year Probable Net Positive/(Negative) Impact toGeneral Revenue Related Funds2026($447,360,000)2027($470,110,000)2028($496,310,000)2029($523,490,000)2030($548,870,000)All Funds, Five-Year Impact: Fiscal Year Probable Revenue (Loss) fromGeneral Revenue Fund1 Probable Revenue (Loss) fromCities Probable Revenue (Loss) fromTransit Authorities Probable Revenue (Loss) fromCounties & Special Districts2026($447,360,000)($81,860,000)($27,130,000)($20,180,000)2027($470,110,000)($86,020,000)($28,510,000)($21,200,000)2028($496,310,000)($90,810,000)($30,100,000)($22,390,000)2029($523,490,000)($95,790,000)($31,750,000)($23,610,000)2030($548,870,000)($100,430,000)($33,290,000)($24,760,000) Fiscal AnalysisThe bill would exclude real property repair and remodeling services from sales and use taxes.The bill would take effect September 1, 2025.
LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE, 89TH LEGISLATIVE REGULAR SESSION
April 9, 2025
TO: Honorable Joan Huffman, Chair, Senate Committee on Finance FROM: Jerry McGinty, Director, Legislative Budget Board IN RE: SB2020 by Campbell (Relating to the exclusion of real property repair and remodeling services from sales and use taxes.), As Introduced
TO: Honorable Joan Huffman, Chair, Senate Committee on Finance
FROM: Jerry McGinty, Director, Legislative Budget Board
IN RE: SB2020 by Campbell (Relating to the exclusion of real property repair and remodeling services from sales and use taxes.), As Introduced
Honorable Joan Huffman, Chair, Senate Committee on Finance
Honorable Joan Huffman, Chair, Senate Committee on Finance
Jerry McGinty, Director, Legislative Budget Board
Jerry McGinty, Director, Legislative Budget Board
SB2020 by Campbell (Relating to the exclusion of real property repair and remodeling services from sales and use taxes.), As Introduced
SB2020 by Campbell (Relating to the exclusion of real property repair and remodeling services from sales and use taxes.), As Introduced
Estimated Two-year Net Impact to General Revenue Related Funds for SB2020, As Introduced: a negative impact of ($917,470,000) through the biennium ending August 31, 2027.
Estimated Two-year Net Impact to General Revenue Related Funds for SB2020, As Introduced: a negative impact of ($917,470,000) through the biennium ending August 31, 2027.
General Revenue-Related Funds, Five- Year Impact:
2026 ($447,360,000)
2027 ($470,110,000)
2028 ($496,310,000)
2029 ($523,490,000)
2030 ($548,870,000)
All Funds, Five-Year Impact:
2026 ($447,360,000) ($81,860,000) ($27,130,000) ($20,180,000)
2027 ($470,110,000) ($86,020,000) ($28,510,000) ($21,200,000)
2028 ($496,310,000) ($90,810,000) ($30,100,000) ($22,390,000)
2029 ($523,490,000) ($95,790,000) ($31,750,000) ($23,610,000)
2030 ($548,870,000) ($100,430,000) ($33,290,000) ($24,760,000)
Fiscal Analysis
The bill would exclude real property repair and remodeling services from sales and use taxes.The bill would take effect September 1, 2025.
Methodology
Under current law, repair and remodeling of residential real property is exempt from sales tax. This bill would exempt such services performed with respect to nonresidential real property.According to the Comptroller of Public Accounts, information regarding the amount spent on the rehabilitation and repair of certain real property in Texas was obtained from the U.S. Census Bureau, adjusted for the amount subject to the provisions of the bill, multiplied by the state tax rate, and extrapolated forward based on projected gross state product for the construction sector.
Local Government Impact
There would be a corresponding loss of sales and use tax revenue from local taxing jurisdictions displayed in the above tables.
Source Agencies: b > td > 304 Comptroller of Public Accounts
304 Comptroller of Public Accounts
LBB Staff: b > td > JMc, KK, SD
JMc, KK, SD