H.B. No. 338 proposes an amendment to Section 23.23(a) of the Texas Tax Code, which pertains to the limitations on increases in the appraised value of residence homesteads for ad valorem taxation. The bill modifies the allowable increase in appraised value from a maximum of 10 percent to a maximum of 5 percent of the appraised value from the preceding tax year. This change aims to provide greater protection for homeowners against significant increases in property taxes.

The bill stipulates that it will only take effect on January 1, 2026, contingent upon the approval of a related constitutional amendment by voters during the 89th Legislature's Regular Session in 2025. If the amendment is not approved, the provisions of this bill will not take effect. This legislative change is intended to ease the financial burden on homeowners by limiting the rate at which their property taxes can increase.

Statutes affected:
Introduced: Tax Code 23.23 (Tax Code 23)