The bill amends the Texas Tax Code to increase the sales tax exemption threshold for clothing, footwear, and certain school-related items from $100 to $150. This change applies to items designed to be worn on the human body and school supplies or backpacks purchased for use by students in public or private elementary or secondary schools. The exemption period remains the same, occurring during the weekend before the school year begins.

Additionally, the bill introduces a provision that will automatically adjust the exemption amount annually starting in 2026 based on the percentage increase in the consumer price index from the previous fiscal year, ensuring that the exemption amount keeps pace with inflation. The bill specifies that the consumer price index refers to the average over a state fiscal year of the Consumer Price Index for All Urban Consumers (CPI-U) published by the U.S. Bureau of Labor Statistics. The changes will not affect taxes imposed before the bill's effective date, and the law prior to this amendment will remain in effect for those taxes.

Statutes affected:
Introduced: Tax Code 151.326, Tax Code 151.327 (Tax Code 151)