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Bill

SJR 25

Proposing a constitutional amendment exempting tangible personal property from ad valorem taxation.

89th Legislature (2025) Introduced by Mayes Middleton

Constitutional amendment exempting business tangible property from Texas property taxes, reducing local government revenue and shifting tax burden to real property owners.

Referred to Local Government
#propertyinterests--personalproperty(i0600) #propertyinterests--realproperty(i0595) #resolutions--constitutionalamendments(i0661) #taxation--property-appraisals&appraisaldistricts(i0792) #taxation--property-assessment&collection(i0798) #taxation--property-exemptions(i0793) #transportation--railroads(i0821)
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Bill Summary · SJR 25

Legislative bill overview

SJR 25 proposes a constitutional amendment that would exempt tangible personal property (such as equipment, machinery, inventory, and other physical business assets) from ad valorem (property value-based) taxation in Texas. If approved by voters, this would prevent local governments from assessing property taxes on these items, though real property (land and structures) would remain taxable.

Why is this important

Tangible personal property taxes currently generate significant revenue for Texas schools, counties, and municipalities. Eliminating this tax source would reduce local government funding unless alternative revenue streams are identified, potentially affecting public services, school budgets, and municipal operations. The change would primarily benefit businesses that hold substantial tangible assets while shifting the tax burden to remaining property types or forcing service cuts.

Potential points of contention

  • Revenue replacement: Local governments would lose hundreds of millions in annual tax revenue with no identified replacement source, potentially impacting education funding and emergency services
  • Equity concerns: The exemption primarily benefits businesses and corporations with significant equipment and inventory, while residential property owners would still pay full property taxes on their homes
  • Implementation complexity: Determining what qualifies as "tangible personal property" versus other property types could create administrative and legal disputes between tax assessors and property owners

Compiled from official sources — confirm details with the bill’s official record.

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