Since the past year, Texas governor Greg Abbott proposed a Property Tax Policy that would cap the annual property tax revenue at 2.5 percent. The bill came about when property owners were surprised at how high their yearly tax has gotten as time went by. With this policy, Abbott aims to lower these tax bills for homeowners so they can save more money.
While the tax reform would benefit homeowners, especially those with expensive homes as they end up saving more, this puts school districts at a disadvantage. The lowered cap for property tax revenue would mean lower funds for schools while taxpayer savings go up. This means that schools will have a hard time getting the budget they need to serve the quality education they’d like.
The new cap on property tax has side effects that could greatly impact the community, especially in the long run. Here’s a few things you need to know about the tax reform as a homeowner and a resident in your county.
Approved by the House
As of March of this year, The House Ways and Means Committee has approved Gov. Abbott’s property tax reform bill, something that he considered was an “emergency” item that needed to be dealt with immediately. It was a long debate before the bill got approved, with many officials from different counties voting against the bill.
San Antonio State Representative Trey Martinez Fischer voted against the bill and said that the 2.5% cap will “put a severe restraint on a local government’s ability to provide for some of the most basic services that the state doesn’t provide when it comes to boots on the ground for public safety, emergency response and in some instances disaster preparedness.”
Still in the works
While it has already been approved, it’s yet to be implemented by the law. The impact that the cap can have on homeowners may depend on where they live and how their home is appraised. One thing that property owners can be sure of is that if their home’s value remains the same as the previous year, they wouldn’t experience more than 2.5 percent of the increase.
If you’re worried about this happening any time soon, you can rest assured that it’ll be a couple of more years before the 2.5 percent rollback rate would be implemented. While the Texas Legislation will be in session until May 31 of this year, it won’t be until 2021 when they will meet again. If the bill has not been passed until then, they may have to reconvene for a special session before 2021.
With this, always review your property tax cards and see if your appraisal district is already implementing the proposed rollback rate. While it does lessen your yearly tax, it can affect your local government districts and the quality of service your get from them. It may sound improbable, but it’s better to be safe than sorry – you should be informed of any changes made to your taxes.
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