Texas Agriculture June 3, 2016 : Page 10

7H[DV)DUP%XUHDXWHVWLÀHV on ag use valuation impact Texas Farm Bureau (TFB) told the Texas House Committee on Ag-riculture and Livestock that the current valuation system is working well, but it could possibly support changes to the rollback provision. The committee is studying the ap-praisal of agricultural land for taxa-tion, including the change-of-use rollback provision. TFB Vice President Michael White of Vernon testified that the organization supports a legislative review of Section 23.55 of the Texas Tax Code, regarding rollback taxes, to define the intent of the law and evaluate potential impacts to agri-culture. “We welcome your findings and would not oppose a reduction in the rollback period if it does not nega-tively affect agriculture or this spe-cial method of tax valuation,” White said. “One provision we oppose in the current law is the payment of interest on each year the rollback is collected. We believe payment of the five years in rollback taxes is suffi-cient without adding interest as an extra expense.” Losing ag use valuation, White noted, would have severe conse-quences for Texas agriculture. “Farming and ranching is a risky and difficult business in many as-pects,” White said. “Current prices for cotton, corn, grain sorghum and cattle—along with the economic fore-casts for the next five to 10 years— are just a few indications of the chal-lenges facing farmers, ranchers and agricultural landowners. Loss of ag use valuation would greatly add to their burden.” Many growers farm leased land, qualifying the land-owners for ag use valuation since the land remains in ag-ricultural produc-Texas Farm Bureau Vice President Michael White tion. stressed the importance of agricultural use valuation “If the land were on farm and ranch land in testimony before the Texas taxed at market House Committee on Agriculture and Livestock late last month. value, landowners would necessarily have to charge producers a higher considerations be given to maintain lease amount. This would likely ag use valuation for taxation of farm make it unprofitable for the producer and ranch property. The hearing of to lease the land, and the landowner the House Committee on Agricul-might be forced to find a use—other ture and Livestock was conducted as than agriculture—for the land be-part of its interim legislative charg-cause of the tax burden.” es. The committee is examining the That could lead to significant loss impact of the current appraisal sys-of productive agricultural acreage. tem of agricultural land for taxation White reiterated that TFB asks all on rural economic development. w.wctractor.com w w WCT RACTOR 75 Ye ars of Service Your LOCAL Full Service Dealer! J UNE 3 , 2016 10 BRENHAM 2106 HWY 290 E. 979.830.0692 BRYAN 1960 N. EARL RUDDER FWY 979.778.0325 TEMPLE 3509 N. 3RD 254.742.1212 NAVASOTA 10044 STATE HWY 6 936.825.7577

Texas Farm Bureau Testifies on Ag Use Valuation Impact

Texas Farm Bureau (TFB) told the Texas House Committee on Agriculture and Livestock that the current valuation system is working well, but it could possibly support changes to the rollback provision. The committee is studying the appraisal of agricultural land for taxation, including the change-of-use rollback provision.

TFB Vice President Michael White of Vernon testified that the organization supports a legislative review of Section 23.55 of the Texas Tax Code, regarding rollback taxes, to define the intent of the law and evaluate potential impacts to agriculture.

“We welcome your findings and would not oppose a reduction in the rollback period if it does not negatively affect agriculture or this special method of tax valuation,” White said. “One provision we oppose in the current law is the payment of interest on each year the rollback is collected. We believe payment of the five years in rollback taxes is sufficient without adding interest as an extra expense.”

Losing ag use valuation, White noted, would have severe consequences for Texas agriculture.

“Farming and ranching is a risky and difficult business in many aspects,” White said. “Current prices for cotton, corn, grain sorghum and cattle—along with the economic forecasts for the next five to 10 years— are just a few indications of the challenges facing farmers, ranchers and agricultural landowners. Loss of ag use valuation would greatly add to their burden.”

Many growers farm leased land, qualifying the landowners for ag use valuation since the land remains in agricultural production.

“If the land were taxed at market value, landowners would necessarily have to charge producers a higher lease amount. This would likely make it unprofitable for the producer to lease the land, and the landowner might be forced to find a use—other than agriculture—for the land because of the tax burden.”

That could lead to significant loss of productive agricultural acreage.

White reiterated that TFB asks all considerations be given to maintain ag use valuation for taxation of farm and ranch property. The hearing of the House Committee on Agriculture and Livestock was conducted as part of its interim legislative charges. The committee is examining the impact of the current appraisal system of agricultural land for taxation on rural economic development.

Read the full article at http://texasagriculture.texasfarmbureau.org/article/Texas+Farm+Bureau+Testifies+on+Ag+Use+Valuation+Impact/2500395/307614/article.html.

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