H.B. No. 106 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—five appointed by the Speaker of the House and five by the Lieutenant Governor—who will be tasked with conducting a comprehensive study on how to replace the lost local tax revenue with local sales and use tax revenue. The committee is required to report its findings and recommendations to the legislature by December 1, 2026, and will be dissolved on January 1, 2027.

In addition to the establishment of the committee, the bill includes a repeal of Title 1 of the Tax Code, effectively prohibiting the imposition of ad valorem taxes by the state or its political subdivisions. However, it specifies that any tax liabilities accrued before January 1, 2031, will remain in effect under the former law for collection and enforcement purposes. The bill's provisions will only take effect if a related constitutional amendment to abolish ad valorem taxes is approved by voters in the 2025 election.

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