Why Texas Can Eliminate Property Taxes

Originally published on Substack. 

A recent post on X from Barrett Lindberg made the rounds, warning Texans that eliminating property taxes is “a mathematical lie.” His thread paints a dramatic picture: Texas balanced on a “two-legged stool,” forced to choose between sky-high sales taxes or deep state control over local communities. According to him, property-tax elimination is not just unrealistic—it’s dangerous.

Here’s Barrett’s analysis if you haven’t seen his post on X.

He makes good observations about the structure of Texas finances, the role of local governments, and the mechanics of school finance. But the conclusions are ultimately flawed because they miss the most important point: the problem is not taxation—it’s spending. And spending at every level of Texas government is growing far faster than Texans’ ability to pay.
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I said as much in my response.

Barrett is right that you can’t “delete $81 billion” of property taxes without replacing it. What he overlooks is that Texas doesn’t need to replace every dollar—it needs to spend less!

That’s the heart of the issue. And the only way to build a future of real homeownership and prosperity is to confront spending directly, not hide behind doomsday math. That’s the way in Washington, but shouldn’t be the way in Texas.

The Real Problem: Overspending, Not Undertaxation
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Local property taxes in Texas now exceed $80 billion per year, up roughly 70 percent from 2015 to 2024, while population growth plus inflation rose only 50 percent. That’s not the “two-legged stool” Barrett describes. That’s a spending stool whose legs keep growing while Texans keep shrinking under the weight.

And it’s not just schools. Cities, counties, hospital districts, appraisal districts, and special taxing districts have been expanding their budgets year after year. When government gets bigger, property taxes follow—no matter what relief gimmicks lawmakers pass.

This is why homestead exemptions don’t solve anything. They don’t reduce spending; they simply shift the tax burden from one group of taxpayers to another.

If Texas doesn’t restrain spending, then no tax structure—three-legged or two-legged or twenty-legged—will ever feel stable.

The Moral Failure: Texans Shouldn’t Have to Rent Their Homes from Government

Property taxes are not just inefficient; they are immoral. They violate the basic principle that individuals should control the value they create and the property they acquire through voluntary exchange. Once a homeowner pays off the mortgage, that home should be theirs—secure, not subject to a perpetual ransom demanded by local government.

No tax that allows the government to seize your home for nonpayment should ever be defended as “good policy.”

Property taxes are also highly regressive. The Texas Comptroller’s Suits Index shows that property taxes fall hardest on lower- and middle-income families. Meanwhile, renters pay property taxes in their rent, and small businesses pay them through commercial leases. The economic burden is everywhere, even where the tax bill isn’t.

Barrett is correct that property taxes hit high-value properties. But he ignores the enormous harm to families trying to build wealth or retire in dignity. If the state’s goal is prosperity, mobility, and ownership, property taxes are the most anti-ownership tax imaginable.

For more on this, check out my property tax research archive.

The Economic Path Forward: Sustainable Budgeting

Now to the economics. Barrett warns that replacing property taxes would require a 20 percent sales tax. But that’s only true under one assumption: that government continues spending at today’s levels.

Texas doesn’t have a revenue problem. It has a spending problem.​

The real solution is simple: adopt a sustainable budget—lower spending now and a growth limit that keeps state and local spending increasing slower than population growth plus inflation thereafter. When spending stays below that threshold, surpluses naturally emerge. Those surpluses should be used to permanently buy down school district property taxes through rate compression—the first and largest component of the levy.

Texas already dipped its toes into this model with tax-rate compression, which Barrett praises. But compression alone is not a long-term strategy because it still allows local spending to grow faster than the average taxpayer’s ability to pay.
The sustainable budget model is a short-run and long-run strategy.

If lawmakers embraced a strict spending limit and used every surplus dollar to buy down school district maintenance and operations property tax rates, Texas could eliminate school district property taxes quickly. Cities, counties, and other local covenants could do the same by holding spending below the limit and using their own surpluses to ratchet down their rates.

No 20 percent sales tax (this is fearmongering). No centralization (except school district funding which the state already controls). No fiscal cliffs (boom and bust cycles). Just disciplined budgeting (like many families).

The 21st-Century Solution: A Single, Simple Sales Tax

Barrett mocks the idea of a sales-tax-based system. But he misses the economic truth: broad-based consumption taxes are the least burdensome tax structure available.

Texas already relies heavily on sales taxes on final goods and services, but they’re riddled with exemptions. Clean up the base, remove carveouts, and modernize it for a 21st-century economy, and Texas could support core services with far less distortion and far more transparency.

This is the model I’ve written about for years:

• Sustainable budgeting with less spending and strict spending limits
• Broad, flat sales tax on final goods and services
• No income tax
• No property tax
• No other taxes or fees

A one-stool system—not the wobbly two-legged one Barrett describes. Think bar stool. Think barber stool. Sturdy. Simple. Hard to kick over.

What Texas Needs Now: Courage

Barrett’s final claim is that elimination “sounds like freedom, but it’s centralization.” What centralizes power is a finance system built on runaway spending and endless property taxes that force Texans into permanent dependence. What decentralizes power is letting Texans own their homes outright and forcing governments to live within their means.

Texas doesn’t need bigger taxes. It needs smaller government. It doesn’t need “rate compression forever.” It needs a path to elimination. It doesn’t need fear about the math. It needs courage, conviction, and leadership that trusts Texans more than bureaucracy.

The truth is simple:

Texas can eliminate property taxes.

Texas should eliminate property taxes.

And if policymakers embrace sustainable budgeting, Texas will eliminate them.
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Freedom begins when government spends less so Texans can prosper more.