Texas Rep. White information invoice to clear property tax

HB3770 is a comprehensive legislative solution for the complete elimination of property tax.

It marks the most significant tax law change in Texas history.

Austin representative James E. White (HD 19) filed HB 3770, the Texas Tax Reform Act of 2021. The bill eliminates sales, property and franchise taxes, replacing them with a fair, efficient and transparent 7% state excise tax with a broader tax base.

When passed, Texas will become the first state in the union with no property tax.

Texas previously abolished property tax. In 1982 Texas abolished all forms of state property taxes. However, they continued to be collected from over 5,000 local jurisdictions, school districts, cities and counties with no mitigation.

As a result, Texans are increasingly being taxed from homes, businesses, and other areas that have been family-owned for generations. To prevent this from ever happening again, HB3770 is proposing a constitutional amendment to ensure a Texas property tax never happens again.

The solution to the bill is "sales-neutral". Local government remains in place while all eliminated tax sources are replaced with revenue of equal value. Using a reformed state and local excise tax, it is carefully implemented over time, using studies, assessments and pilot projects to avoid any unintended consequence.

The municipalities' consumption tax ceilings will be raised from 1/2% to 1% and the tax base will be expanded. The counties stay at 1%, but the wider tax base results in higher income. School districts are entitled to raise up to 1/2% within their limits for enrichment purposes, but the total local exposure is limited to 3%.

District evaluation districts are eliminated. This ends the recurring annual ritual of over 2 million reassessments, hearings, and denials that cost Texas taxpayers more than $ 500 million annually.

The same proposal was first tabled by Rep. George Lavender (HD 1) as the Texas Tax Reform Act of 2013. This draft law is now being revised and reintroduced as HB3770.

Rep. White is currently Chairman of Homeland Security and Public Security and a member of the Corrections and Redistribution Committee.