AUSTIN (Nexstar) – Texas leaders are still at odds over plans to lower your property taxes. On Tuesday, the Texas Senate unanimously approved its largest property tax relief plan yet.
“The senate plan is a record $18 billion of tax relief going straight to school taxpayers across the state,” said State Sen. Paul Bettencourt (R-Houston) the author of the legislation. His bill would require voter approval in a constitutional amendment election.
But it’s not clear if the $18 billion dollar plan will break the stalemate between the state’s top leaders over how to provide tax relief.
The new proposal preserves the Senate’s top priority of raising the homestead exemption to $100,000, the most direct benefit to homeowners and the major sticking point between the upper chamber and Gov. Greg Abbott. It also dedicates $400 million more towards buying down school district property tax rates, the strategy Abbott prefers exclusively.
Bettencourt said he believes combining an increased homestead exemption with tax rate cuts is the best plan for Texas taxpayers. He said the Senate plan provides ‘eye-popping savings’ of nearly $1,300 per year for the average homeowner.
“The most powerful thing I could do as a tax writer is say ‘don’t pay.’ And that’s an exemption, or a rollback rate reduction or franchise tax doubling so 67,000 business owners don’t pay. That’s the way to go,” Bettencourt added.
Senators’ latest offer comes after weeks of a stalemate between the upper chamber and the governor, who supports the House plan of rate compression passed on the first full day of the special legislative session. Even during the regular session, top Republicans wrestled for months over how to cut property taxes with Texas’ historic budget surplus of $33 billion.Renae Eze, spokesperson for Abbott, did not signal openness to the new Senate proposal on Tuesday — again emphasizing that the governor wants to see a reduction in taxes through rate compression, in which the state gives more money to school districts so they in turn can lower their tax rates.
Abbott has said he believes this is the best pathway toward fulfilling his goal of ultimately eliminating property taxes.“The Governor has been clear that his goal is to put Texans on a pathway to eliminate their school M&O property taxes, and the best way to do that is to devote all property tax relief to cutting property tax rates.
The Governor has also been clear that the only way a property tax bill gets to his desk is for the Texas House and Texas Senate to agree to a bill and get it to the Governor’s desk, and he encourages the two chambers to work towards a solution,” Eze said in a statement.