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Bill

Bill

HB 45

Relating to the abolition of ad valorem taxes and the creation of a joint interim committee on the abolition of those taxes.

89th Legislature, 1st Called Session (2025) Introduced by Brian Harrison

Bill establishes committee to plan abolishing Texas property taxes and finding $60+ billion in alternative revenue sources to fund local services.

Filed
#interimstudies(i0448) #lieutenantgovernor(s0096) #legislature(i0520) #politicalsubdivisions(i0588) #speakerofthehouse(s0306) #taxation--city(i0775) #taxation--county(i0780) #taxation--property-assessment&collection(i0798) #taxation--sales(i0800) #taxation--schooldistrict(i0785)
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Bill Summary · HB 45

Legislative bill overview

HB 45 proposes to abolish ad valorem taxes (property taxes based on assessed value) in Texas and establishes a joint interim committee to study and plan the implementation of this abolition. The bill directs the committee to develop a comprehensive transition plan and identify alternative revenue sources to replace the estimated $60+ billion in annual property tax revenue.

Why is this important

Property taxes fund essential local services including schools, emergency services, infrastructure, and county operations. Eliminating them without viable replacement revenue would fundamentally restructure Texas tax policy and could create significant funding gaps for local governments. This represents one of the most substantial fiscal restructuring proposals in state history.

Potential points of contention

  • Revenue replacement challenge: Identifying $60+ billion in alternative revenue (whether through sales tax increases, income tax implementation, or other mechanisms) presents substantial political and economic hurdles
  • Local government autonomy: Ad valorem taxes allow local control over funding levels; abolition could shift power to state level and reduce municipal fiscal independence
  • Unequal transition impacts: Different regions rely on property taxes differently; urban areas with higher property values may experience greater disruption than rural areas
  • Timing and implementation: A rushed transition could destabilize school funding, infrastructure maintenance, and emergency services before alternative systems are operational

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

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