H.B. No. 260 proposes the abolition of ad valorem taxes in Texas and establishes a joint interim committee to study the implications of this change. The committee will consist of ten members, with five appointed by the Speaker of the House and five by the Lieutenant Governor, and is tasked with conducting a comprehensive study on how to replace the lost local tax revenue with local sales and use tax revenue. The committee will also explore the authority of political subdivisions to impose sales and use taxes, determine necessary tax rates, evaluate the effects of broadening sales tax applications, and identify any issues that need to be addressed for the implementation of the abolition.

Additionally, the bill includes a repeal of Title 1 of the Tax Code, explicitly stating that neither the state nor its political subdivisions may impose ad valorem taxes. However, it preserves tax liabilities that accrued before January 1, 2031, ensuring that former laws remain in effect for the collection and enforcement of those taxes. The bill's provisions will take effect only if a proposed constitutional amendment to abolish ad valorem taxes is approved by voters, with certain sections becoming effective on January 1, 2026, and others on January 1, 2031.

Statutes affected:
Introduced: ()