The bill, S.B. No. 2907, proposes an exemption from ad valorem taxation for certain perishable inventory held for retail sale in Texas. It introduces a new section, Section 11.38, to the Tax Code, defining "perishable inventory" to include various food products, prescription and nonprescription drugs, and dietary supplements that may spoil or become unfit for consumption. The bill stipulates that individuals are entitled to an exemption from taxation on the total appraised value of their perishable inventory, provided they do not owe any delinquent taxes as of January 1 of the tax year.

The act is set to take effect on January 1, 2026, contingent upon the approval of a constitutional amendment by voters that would allow the legislature to exempt such inventory from taxation. If the amendment is not approved, the act will have no effect. This legislation aims to support retailers by alleviating some of the tax burdens associated with perishable goods, thereby potentially benefiting both businesses and consumers.

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