Recent research conducted by the Huffines Liberty Foundation has revealed an increase in property tax revenue in 2023, despite the enactment of tax cut legislation by the legislature the previous year. The study, led by Foundation President Don Huffines and Policy Analyst Bill Peacock, suggests further measures that lawmakers could adopt to alleviate the property tax burden on Texans.
In July 2023, during the second special Legislative session, Texas state Sen. Paul Bettencourt introduced SB2. As per the bill's fiscal note, it allocated $12.7 million to decrease property taxes over a two-year span. The bill was passed in both the House and Senate and received approval from Texas Gov. Greg Abbott.
According to the research conducted by Huffines Liberty Institute, SB2 was touted as an $18 billion tax cut, even though only $12.7 billion was actually allocated for this purpose. Moreover, it challenged the claim that SB2 represented the "largest tax relief in Texas history", pointing out that it fell short of a tax cut passed by the Legislature in 2007 by $600 million.
Data recently released by Texas Comptroller Glenn Hegar indicates that property tax revenues saw an increase of over $165 million in 2023. This surge was driven by special taxing districts, cities, and counties all reporting an increase in their respective tax revenues. Special districts reported the most significant rise at 13.74%.
The research carried out by Huffines Liberty Institute suggested that this increase transpired because local taxing authorities raised property taxes more than what SB2 had reduced them by. It proposed that lawmakers should have enacted additional legislation to prevent such increases from negating the impact of the tax cut. In conclusion, it recommended eliminating school property taxes within a decade through measures such as limiting state government spending growth, freezing Maintenance & Operations (M&O) school tax rates, and allocating 90% of future budget surpluses towards tax relief.
The Huffines Liberty Institute, a non-profit and non-partisan research organization, was established by Huffines, a former Texas state senator.
