State officials say eliminating property taxes would cost over $80 billion

Originally published at KTRH News Houston.

State budget officials believe Texas would have to spend about $81.5 billion a year to end property taxes.

Reducing or even eliminating the state’s high property taxes has been something on the minds of Texas lawmakers for a handful of years now.

The Texas Senate Finance Committee were presented the costs from the Legislative Budget Board recently. Just over half ($42 billion) would go to cover the property taxes collected by cities, counties and special taxing districts from last year.

Economist Vance Ginn calls property taxes "fundamentally immoral."

"I believe that they should be eliminated at the end of the day but of course with any sort of policy change nothing is free," he said.

School property taxes make up a large portion of the figure too. Budget officials say that getting rid of all property taxes collected by school districts would cost the state $39.5 billion.

"That's really where the focus is is the state eliminating the school portion first," Ginn said, who believes would take about a decade if state spending is seriously limited.

Ginn also suggested using surplus money to buy down the school maintenance and property tax over time wouldn't be a bad idea either in eliminating nearly half of the state's property taxes.

"There are ways to do this in a fiscally conservative way that can allow for Texas to get rid of property taxes within about a decade, certainly about half the property taxes, but they could even do all the property taxes if local governments would also limit their spending," Ginn said.

According to Ginn, state lawmakers have put around $18 billion towards property tax relief with $12.7 billion in new relief approved during the last legislative session. However, there has not been much change overall in Texas property taxes.

"There's more that needs to be done to reign in government spending at the local levels and the state level," said Ginn. "Reducing property taxes for Texans would be a huge relief for them."