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HB 240

Relating to the definitions of certain terms for purposes of the exemption from ad valorem taxation of farm products in the hands of the producer.

89th Legislature, 2nd Called Session (2025) Introduced by Trent Ashby and 4 co-sponsors

HB 240 redefines farm producer and product terms to adjust Texas agricultural property tax exemption eligibility, potentially expanding coverage and reducing local tax revenue.

Referred to Ways & Means
#agriculture(i0020) #taxation--property-appraisals&appraisaldistricts(i0792) #taxation--property-exemptions(i0793)
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Bill Summary · HB 240

Legislative bill overview

HB 240 modifies the legal definitions used to determine which agricultural producers qualify for ad valorem tax exemptions on farm products in Texas. The bill refines terminology related to what constitutes a "producer" and farm product eligibility, potentially expanding or clarifying who can access these tax benefits.

Why is this important

Ad valorem tax exemptions for farm products represent significant tax savings for agricultural operations. Changes to these definitions directly affect which farmers and ranchers qualify for tax relief, influencing their operating costs and competitive positioning within the agricultural sector. This particularly impacts smaller producers, beginning farmers, and operations in transitional agricultural areas.

Potential points of contention

  • Definition scope: Unclear whether changes expand exemptions to non-traditional agricultural operations or contract farmers, potentially affecting tax base and local government revenue
  • Implementation complexity: Revised definitions may create compliance uncertainty for county appraisers assessing eligibility, leading to inconsistent application across Texas counties
  • Revenue implications: Depending on how definitions broaden, this could reduce property tax revenue for schools and local governments that rely on agricultural property assessments

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

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