Chapter 325A · Texas Property Tax Reform Bill · Non-Partisan InitiativeA citizen's guide · 2025 data
Texas Property TaxReform Plan

2025 data · 1,038 Texas cities

Lower property taxes.
Paid for by growth.

The Bill shifts city and county M&O property taxes onto statewide economic activity. See what it would mean for your home.

2025 data · city M&O property tax

Pick yours from the list or click to pull from your current location.

Enter the city taxable value from your appraisal notice (after your homestead and other exemptions). Your appraisal district lists it separately for each taxing unit.

How it works

From the checkout line to your tax bill

  1. Economic activity occurs

    Consumers spend money at businesses across Texas. Taxable sales and services generate state sales and use tax revenue.

  2. The state collects sales tax

    The State of Texas collects sales and use tax and deposits it into the Replacement Revenue Fund established by Chapter 325A.

  3. Formula distribution by the Comptroller

    The Texas Comptroller calculates each municipality's and county's share using a uniform, formula-based method based on local taxable economic activity.

  4. Funds returned locally

    Revenue is returned to the municipality or county where the economic activity occurred.

  5. Property tax reductions

    Local governments reduce their M&O property tax rate as replacement revenue is certified. Over time, M&O property taxes can be eliminated.

See the safeguards

The split

2.75% for property tax relief

Inside city limits

2.00 + 0.75

2.00 points to the city, 0.75 to the county.

Unincorporated areas

2.75

All 2.75 points to the county.

Economic activityReplacement revenueLower M&O taxes

Key points

What the Bill does

Establishes an additional 2.75% statewide sales and use tax dedicated by statute to the property-tax replacement system.
Uses origin-based attribution, meaning replacement revenue begins with the jurisdiction where the taxable economic activity occurs.
Allocates 2.00 percentage points to municipalities and 0.75 percentage points to counties for taxable transactions occurring inside a municipality.
Allocates the full 2.75 percentage points to counties for taxable transactions occurring in unincorporated areas.
Keeps county and municipal revenue separately accounted for, generally prohibiting one allocation subaccount from being used to satisfy obligations of the other.
Requires replacement revenue to reduce M&O property taxes rather than becoming unrestricted additional local-government revenue.

Read all 17 points