Texas Senate Bill SB994

Texas 2025 - 89th Regular

• Filed: 1/29/25

Caption

Relating to an exemption from ad valorem taxation of tangible personal property consisting of animal feed held by the owner of the property for sale at retail.

Impact

If enacted, SB994 would amend Chapter 11 of the Tax Code by adding Section 11.162, which allows owners of eligible animal feed to benefit from this new tax exemption. This change is contingent upon the approval of a constitutional amendment proposed during the 89th Legislature (Regular Session, 2025), which would enable such exemptions at the state level. The exemption would apply only to ad valorem taxes for tax years beginning on or after January 1, 2026, should the amendment pass, effectively creating a window for implementation.

Summary

Senate Bill 994 proposes an exemption from ad valorem taxation for tangible personal property specifically consisting of animal feed that is held by the owner for retail sale. This legislative effort aims to alleviate the tax burden on sellers of animal feed, aligning with existing sales tax exemptions applicable under Texas law. The bill seeks to ensure that such property, which is integral to agricultural and livestock operations, is treated favorably in terms of taxation, thereby providing support to the agricultural sector.

Contention

Notably, the passage of SB994 may spark discussions regarding equity in taxation and the implications for other agricultural-related products that may seek similar treatment. While proponents may argue that this exemption supports farmers and retailers by reducing their operational costs, critics might voice concerns regarding the potential loss of tax revenue for local governments. Thus, the bill may raise issues about how tax relief measures impact overall state funding and resources devoted to public services. The requirement for voter approval of the related constitutional amendment also indicates an additional layer of public engagement and scrutiny surrounding the proposed tax change.

Texas Constitutional Statutes Affected

Tax Code

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