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HB 356

Relating to the limitation on increases in the appraised value of a residence homestead for ad valorem taxation.

89th Legislature (2025) Introduced by Will Metcalf

Texas HB 356 limits annual increases in residential property tax appraisals to reduce homeowner tax bills but risks cutting local government funding and creating unequal taxation of similar properties.

Referred to s/c on Property Tax Appraisals by Speaker
#propertyinterests--homestead(i0616) #taxation--property-appraisals&appraisaldistricts(i0792) #taxation--property-exemptions(i0793)
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WeVote Research Nonpartisan
Bill Summary · HB 356

Legislative bill overview

HB 356 proposes to limit how much the appraised value of a primary residence can increase annually for property tax purposes in Texas. The bill aims to cap the growth in homestead valuations, which directly affects the ad valorem (property) taxes homeowners pay each year. This represents a modification to current Texas homestead exemption and appraisal practices.

Why is this important

Property tax increases significantly impact homeowners' ability to afford housing, particularly in rapidly appreciating markets. Texas has experienced substantial property value increases in recent years, leading to higher tax bills for existing residents. Changes to appraisal limitation policies directly affect state revenue, local government funding (schools, counties), and housing affordability.

Potential points of contention

  • Fiscal impact on local governments: Capping appraisal increases reduces tax revenue for schools, counties, and municipalities, potentially requiring reduced services or alternative funding sources
  • Market distortion and inequity: Properties with identical market values could be taxed differently based on purchase timing, creating horizontal inequity and potentially discouraging property maintenance or improvements
  • State budget implications: Lower property tax revenue may shift funding burdens to state coffers or reduce overall government funding for public services

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

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