Bill Caption

Relating to the exemption from ad valorem taxation of precious metal held in the Texas Bullion Depository.

Fiscal Notes

Depending on the value of precious metals held in the depository that would be taxable under current law, provisions of the bill exempting precious metals held in the depository from ad valorem taxation would result in an indeterminate loss of local ad valorem tax revenues.

Bill Analysis

This bill would entitle a person to "an exemption from taxation of the precious metal that the person owns and that is held in the Texas Bullion Depository." If enacted, this bill would only take effect if the corresponding constitutional amendment (HJR 38) is also passed by the legislature and approved by voters of this state. 

Vote Recommendation Notes

This bill exempts an entire class of property from taxation to the equal benefit of all owners of that type of property. However, this would also have the effect of using the tax system to encourage people to store their precious metals in a specific depository instead of using other storage options that may be available to them. This is a form of picking winners and losers in the economy through state policy. We support the concept of exempting precious metals from taxation but oppose using tax policy to incentivize utilization of a state-preferred storage option. For these reasons we remain neutral on this legislation.