Relating to the abolition of ad valorem taxes and the creation of a joint interim committee on the abolition of those taxes.

HB 260 creates a joint legislative committee to study replacing local property taxes (ad valorem taxes) with sales taxes. The committee, composed of five House members and five Senators appointed by leadership, will examine how to maintain local tax revenue after abolishing property taxes, including determining necessary sales tax rates, assessing impacts on revenue disparities, and evaluating redistribution mechanisms. It must submit a report with recommendations by December 1, 2026, and will dissolve on January 1, 2027. The bill also prohibits future ad valorem taxes statewide, but the committee’s study will guide implementation. This affects Texas local governments that currently rely on property tax revenue.