Proposing a constitutional amendment authorizing the legislature to provide that the appraised value of a residence homestead for ad valorem tax purposes for the first tax year that the owner of the property qualifies the property for a residence homestead exemption is the market value of the property and that, if the owner purchased the property, the purchase price of the property is considered to be the market value of the property for that tax year and to limit increases in the appraised value of the homestead for subsequent tax years based on the inflation rate.

HJR 74 proposes a constitutional amendment to change how Texas calculates property taxes for homesteads. It would allow the legislature to set the initial appraised value of a primary residence for tax purposes in the first year a homeowner qualifies for the homestead exemption to either the property's market value or its purchase price (if the homeowner bought it). For subsequent years, increases in the appraised value would be limited to the inflation rate. This amendment would directly affect homeowners who claim the homestead exemption by potentially lowering their initial tax burden and capping future tax increases.