Wednesday, March 23, 2022

From the Texas Tribune: Analysis: Texas government’s favorite local tax

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If you think about it, property taxes in Texas are a pretty sweet deal for the state government.

Owners of homes and other properties don’t like it so much, and neither do renters, who pay the tax invisibly through the owners of the properties they rent. Texans pay some of the highest property taxes in the U.S. The state ranks sixth nationally in property taxes paid as a percentage of owner-occupied housing value, according to the Tax Foundation. That organization ranks Texas 13th among the states in property tax collections per capita. It also says only three states rely more heavily on property taxes than Texas, where 44% of all local and state tax collections come from property taxes.

But the state of Texas itself doesn’t levy a property tax. Only school districts, counties, hospital districts and local government entities can do that — and they often use those locally raised property tax dollars to cover holes left in their budgets by the state.

It has proven almost impossible to get meaningful property tax relief from the same state politicians who campaign on that issue every two years. Not only are they insulated from collecting property taxes, but the only way to lower property taxes is to either cut services and programs that Texans want, like public schools and public health, or to raise other taxes themselves.

Making sympathetic noises about Texans’ high property taxes while not actually doing anything meaningful to lower them is much easier — and, so far, has provided legislative and statewide incumbents with a powerful and perennial political issue that doesn’t require them to do anything they’d consider painful.

In the case of school district taxes in particular, that means Texans pay higher property taxes because the state relies on school districts to lower its own bill for public education. It’s baked into the state budget, as pointed out, most recently, by the Texas Association of Appraisal Districts.