The impact of property tax exemptions on the effective property tax rate: evidence from 41 Texas cities

Using a panel dataset for 41 Texas cities from 2000 to 2015, we examine the impact of property tax exemptions on the overall effective property tax burden. Using instrumental variable (IV) analysis, the results show that property tax exemptions are positively correlated with the overall property tax burden. After breaking down exemptions by types, we find that tax relief exemptions, particularly exemptions offered to disabled and senior homeowners, primarily drive the increase in the effective property tax burden. © 2022, The Author(s), under exclusive licence to Springer Nature B.V.