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Relating to a franchise or insurance tax credit for low-income
Estimated Two-year Net Impact to General Revenue Related Funds for HB1937, As
Introduced: an impact of $0 through the biennium ending August 31, 2021.
However, the bill will have a direct impact of a revenue loss to the Property Tax Relief Fund
of ($10,500,000) for the 2022-23 biennium, eventually growing to ($70,000,000) per
biennium. Any loss to the Property Tax Relief Fund must be made up with an equal amount
of General Revenue to fund the Foundation School Program
HB 1937 would allow entities to apply for a franchise or insurance tax credit if the entity owns an interest in low-income housing developments provided they meet certain conditions.
Texas Action opposes HB 1937 for violating the principles of limited government a free markets. Tax exemptions and credits for protected classes of persons or businesses unfairly raises the burden on the rest of the tax base. Taxes, when necessary, should be applied in a broad-based and equal manner, without any targeted protections for special classes or incentives to engage in particular economic activity.