Abbott again called for “the largest property tax cut in Texas history,” a line he first called it is used back in September. At that time, he wanted to use “at least half” of that timeprojected A $27 billion surplus in state coffers to lower local school district tax rates.
That assessment grew to $32.7 billion in an update from the Texas Comptroller earlier this month.
In his speech, Patrick called for raising the corporate personal property tax exemption to $100,000 — reducing the taxable value of business inventory and other tangible assets. That exemption is currently $500. Both officials expressed their desire to keep Texas a business-friendly state, and business taxation reform is a central part of it.
But Patrick shed light on something previously not mentioned with any specifics: He intends to raise the state’s standard homestead exemption to $70,000. At his press conference in November during which a broad list of priorities was announced, Patrick stated the exemption should be increased — without specifying hard figures.
But now a specific figure has been named. Since Abbott and Patrick first took office, the estate exemption has grown from $15,000 to $40,000 and, if all goes according to Patrick’s plan, will nearly double later this year.
If the household exemption were to increase, the average home owner in Texas — by means of an average tax rate in the past few years — that their school district tax bill will remain the same.
This would be on top of any reduction caused by state compression. In addition to funds allocated from the projected surplus, the state dedicated $3 billion in federal aid to fight the coronavirus for compression this year.
Much of House Speaker Dade Phelan’s (R-Beaumont) push has to do with property taxes rhetoric focused on shaking up the grading process.
The inauguration did not mention any agreed-upon plan to move the state away from the current property tax system.
Abbott is earlier indicated support for repealing the school district maintenance and operation rate, the largest component of the Texas property tax bill. But so far there is little indication that reform is on the agenda beyond compression, increased exemptions and a shake-up of the rating system.