Texas Proposition 2, Prohibit Capital Gains Tax on Individuals, Estates, and Trusts Amendment (2025)

Texas Proposition 2
Election date November 4, 2025
Topic Income taxes
Status On the ballot
Type Legislatively referred constitutional amendment	Origin State legislature

Texas Proposition 2, the Prohibit Capital Gains Tax on Individuals, Estates, and Trusts Amendment, is on the ballot in Texas as a legislatively referred constitutional amendment on November 4, 2025.

A "yes" vote supports amending the state constitution to prohibit the state legislature from enacting a tax on realized or unrealized capital gains of an individual, family, estate, or trust, including a tax on the sale or transfer of a capital asset.

A "no" vote opposes amending the state constitution to prohibit the state legislature from enacting a tax on realized or unrealized capital gains of an individual, family, estate, or trust.

Overview

What would Proposition 2 prohibit in the state constitution?

See also: Text of measure

The amendment would amend Article 8 of the Texas Constitution to prohibit the Texas State Legislature from imposing a tax on realized or unrealized capital gains of an individual, family, estate, or trust, including a tax on the sale or transfer of the capital asset.

A capital asset is property held for personal investment, like stocks, bonds, real estate, and personal vehicles. Realized gains are the profits an individual makes from selling that investment. In contrast, unrealized gains represent the potential profit an individual could make if they were to sell an investment at its current market value.

The amendment would also add language stating that the prohibition would not apply to ad valorem taxes on property, sales taxes on goods and services, or a use tax on the storage, use, or other consumption of goods and services within the state.

Do any states tax realized or unrealized capital gains?

See also: Capital gains tax rates

For tax year 2024, 42 states taxed capital gains. The highest rate for each state ranged from 2.5% in Arizona to 14.4% in California. Eight states, including Texas, do not tax capital gains. No state has enacted a tax on unrealized capital gains. California, Illinois, New York, Vermont, and Washington have considered legislation that proposed taxing unrealized capital gains.

The federal government taxes capital gains according to how long they were held by the taxpayer. Short-term capital gains apply to capital assets held for less than a year, while long-term capital gains apply to capital assets held for more than one year. Short-term capital gains are taxed as regular income at the rate that applies to the taxpayer's income bracket. Long-term capital gains are taxed according to filing status and income bracket.

Who supports and opposes Proposition 2?

See also: Support and Opposition

Texas Farm Bureau and Texas Policy Research endorsed Proposition 2. Texas Policy Research said, "This measure upholds individual liberty, private property rights, and free enterprise by protecting Texans from future financial intrusion and double taxation. It strengthens Texas’s commitment to limited government and long-term economic competitiveness."

Ballotpedia has not located a campaign in opposition to the ballot measure. You can share campaign information or arguments, along with source links for this information, with us at editor@ballotpedia.org.

Text of measure

Ballot title

The ballot title is as follows:

“

The constitutional amendment prohibiting the imposition of a tax on the realized or unrealized capital gains of an individual, family, estate, or trust.

”

Constitutional changes

See also: Article 8, Texas Constitution

The measure would add Section 24-b to the state constitution. The following underlined text would be added:

Sec. 24-b. (a) Subject to Subsection (b) of this section, the legislature may not impose a tax on the realized or unrealized capital gains of an individual, family, estate, or trust, including a tax on the sale or transfer of a capital asset that is payable by the individual, family, estate, or trust selling or transferring the asset.

(b) This section may not be construed as modifying the applicability or prohibiting the imposition or change in the rate of:

(1) an ad valorem tax on property;

(2) a sales tax on the sale of goods or services; or

(3) a use tax on the storage, use, or other consumption in this state of goods or services.

Full text

The full text is available here.

Support

Ballotpedia has not located a campaign in opposition to the ballot measure. You can share campaign information or arguments, along with source links for this information, with us at editor@ballotpedia.org.

Supporters

Officials

• Gov. Greg Abbott (R)

Organizations

• Texas Farm Bureau (AGFUND)
• Texas Policy Research

Arguments

• Gov. Greg Abbott (R): "This is the extension of our collective disdain in Texas for any type of tax."
• Texas Policy Research: "This measure upholds individual liberty, private property rights, and free enterprise by protecting Texans from future financial intrusion and double taxation. It strengthens Texas’s commitment to limited government and long-term economic competitiveness."

Opposition

Ballotpedia has not located a campaign in opposition to the ballot measure. You can share campaign information or arguments, along with source links for this information, with us at editor@ballotpedia.org.

Arguments

You can share campaign information or arguments, along with source links for this information, at editor@ballotpedia.org.

Campaign finance

See also: Campaign finance requirements for Texas ballot measures

Ballotpedia has not identified any committees registered to support or oppose Proposition 2. If you are aware of a committee registered to support or oppose this amendment, please email editor@ballotpedia.org.

	Cash Contributions	In-Kind Contributions	Total Contributions	Cash Expenditures	Total Expenditures
Support	$0.00	$0.00	$0.00	$0.00	$0.00
Oppose	$0.00	$0.00	$0.00	$0.00	$0.00
Total	$0.00	$0.00	$0.00	$0.00	$0.00

Background

Capital gains tax rates

Federal rate

The federal government taxes capital gains according to how long they were held by the taxpayer. Short-term capital gains apply to capital assets held for less than a year, while long-term capital gains apply to capital assets held for more than one year. Short-term capital gains are taxed as regular income at the rate that applies to the taxpayer's income bracket. Long-term capital gains are taxed according to filing status and income bracket. The federal capital gains tax rates for tax years 2024 and 2025 are below:

Federal tax rates on long-term capital gains

Tax rate	Individuals	Married Filing Jointly	Head of Household	Married Filing Separately
0%	$0 – $48,350	$0 – $96,700	$0 – $64,750	$0 – $48,350
15%	$48,351 – $533,400	$96,701 – $600,050	$64,751 – $566,700	$48,350 – $300,000
20%	$533,401+	$600,051+	$566,701+	$300,001+

State rates

The following eight states do not tax capital gains:

• Alaska
• Florida
• Nevada
• New Hampshire

• South Dakota
• Tennessee
• Texas
• Wyoming

For tax year 2024, 42 states taxed capital gains. The highest rate for each state ranged from 2.5% in Arizona to 14.4% in California. New Mexico, North Dakota, Oklahoma, South Carolina, Vermont, and Wisconsin authorize certain deductions that reduce taxable income. Washington excludes real estate, retirement savings, livestock, and timber from its capital gains tax. The map below shows the maximum capital gains tax rates in each state across the U.S.

Proposed taxes on unrealized capital gains

Unrealized capital gains are an increase in value from the purchase price of a capital asset to the present-day market value before it has been sold. At the state level, no state has enacted a tax on unrealized capital gains as of 2025. California, Illinois, New York, Vermont, and Washington have considered legislation that proposed taxing unrealized capital gains.

At the federal level, former President Joe Biden (D) proposed a 25% tax on unrealized capital gains for taxpayers with net wealth above $100 million in his fiscal year 2025 budget in March 2024. Former Vice President Kamala Harris (D) presidential campaign included a similar proposal.

Texas constitutional amendments to prohibit taxes

Since 1993, Texas voters have decided on three amendments to prohibit future taxes by adding the prohibitions to the state constitution. All three were approved. In 2025, voters will decide on three amendments to prohibit future taxes.

Year	Type	Title	Description	Result	Yes Votes	No Votes
2025	LRCA	Proposition 2	Prohibit a tax on the realized or unrealized capital gains of an individual, family, estate, or trust		0 (0%)	0 (0%)
2025	LRCA	Proposition 6	Prohibit the enactment of laws that impose taxes on entities that enter into transactions conveying securities or on certain securities transactions		0 (0%)	0 (0%)
2025	LRCA	Proposition 8	Prohibit the state legislature from enacting laws imposing taxes on a decedent's property or the transfer of an estate		0 (0%)	0 (0%)
2023	LRCA	Proposition 3	Prohibit a wealth or net worth tax	a	1,712,458 (68%)	809,815 (32%)
2019	LRCA	Proposition 4	Prohibit the state from levying an income tax on individuals to the Texas Constitution	a	1,477,373 (74%)	509,547 (26%)
1993	LRCA	Proposition 4	Prohibit personal income tax without voter approval, directing revenue to education and limiting local school tax rates.	a	775,822 (69%)	343,638 (31%)

Path to the ballot

Amending the Texas Constitution

See also: Amending the Texas Constitution

A two-thirds (66.67%) vote is required during one legislative session for the Texas State Legislature to place a constitutional amendment on the ballot. That amounts to a minimum of 100 votes in the Texas House of Representatives and 21 votes in the Texas State Senate, assuming no vacancies. Amendments do not require the governor's signature to be referred to the ballot.

Senate Joint Resolution 18 (2025)

The following is the timeline of the constitutional amendment in the state legislature:

• November 12, 2024: Senate Joint Resolution 18 (SJR 18) was prefiled.
• March 18, 2025: The Senate passed SJR 18 by a vote of 24-6.
• April 28, 2025: The House passed an amended version of SJR 18 by a vote of 104-26.
• May 5, 2025: The Senate concurred with the amended version by a vote of 25-6.

Partisan Direction Index = +59.3% (Lean Republican)

Democratic Support

40.7%

Republican Support

100.0%

How does this vote compare to other legislative ballot measures in 2025?
Learn more about the ballot measures PDI →

 Texas House of Representatives

Voted on April 28, 2025

Votes Required to Pass: 100
	Yes	No	NV
Total	104	26	20
Total %	69.3%	17.3%	13.4%
Democratic (D)	17	26	19
Republican (R)	87	0	1

Texas State Senate

Voted on May 5, 2025

Votes Required to Pass: 21
	Yes	No	NV
Total	25	6	0
Total %	80.6%	19.4%	0.0%
Democratic (D)	5	6	0
Republican (R)	20	0	0

How to cast a vote

See also: Voting in Texas

See below to learn more about current voter registration rules, identification requirements, and poll times in Texas.

How to vote in Texas

Poll times

In Texas, all polling places are open from 7:00 a.m. to 7:00 p.m. local time. Texas is divided between the Central and Mountain time zones. An individual who is in line at the time polls close must be allowed to vote.

Registration

Check your voter registration status here.

To register to vote in Texas, an applicant must be a United States citizen, a resident of the county in which he or she is registering, and at least 17 years and 10 months old.

The deadline to register to vote is 30 days before the election. Prospective voters can request a postage-paid voter registration form online or complete the form online and return it to the county voter registrar. Applications are also available at a variety of locations including the county voter registrar’s office, the secretary of state’s office, libraries, and high schools. Voter registration certificates are mailed to newly registered voters.

Automatic registration

Texas does not practice automatic voter registration.

Online registration

See also: Online voter registration

Texas does not permit online voter registration.

Same-day registration

Texas does not allow same-day voter registration.

Residency requirements

Prospective voters must reside in the county in which they are registering to vote.

Verification of citizenship

See also: Laws permitting noncitizens to vote in the United States

Texas does not require proof of citizenship for voter registration. An individual applying to register to vote must attest that they are a U.S. citizen under penalty of perjury.

State law requires election officials to conduct a check of registered voters' citizenship status. Section 18.068 of the Texas Election Code says the following:

“	The secretary of state shall quarterly compare the information received under Section 16.001 of this code and Section 62.113, Government Code, to the statewide computerized voter registration list. If the secretary determines that a voter on the registration list is deceased or has been excused or disqualified from jury service because the voter is not a citizen, the secretary shall send notice of the determination to the voter registrar of the counties considered appropriate by the secretary.	”
—Section 18.068, Texas Election Code

In January 2019, the Texas secretary of state’s office announced that it would be providing local election officials with a list of registered voters who obtained driver’s licenses or IDs with documentation such as work visas or green cards. Counties would then be able to require voters on the list to provide proof of citizenship within 30 days. The review was halted by a federal judge in February 2019, and Secretary of State David Whitley rescinded the advisory in April. A news release from Whitley’s office stated that “... going forward, the Texas Secretary of State's office will send to county voter registrars only the matching records of individuals who registered to vote before identifying themselves as non-U.S. citizens to DPS when applying for a driver's license or personal identification card. This will ensure that naturalized U.S. citizens who lawfully registered to vote are not impacted by this voter registration list maintenance process.”

All 49 states with voter registration systems require applicants to declare that they are U.S. citizens in order to register to vote in state and federal elections, under penalty of perjury or other punishment. Seven states — Alabama, Arizona, Georgia, Kansas, Louisiana, New Hampshire, and Wyoming — have laws requiring verification of citizenship at the time of voter registration, whether in effect or not. In three states — California, Maryland, and Vermont — at least one local jurisdiction allows noncitizens to vote in some local elections. Noncitizens registering to vote in those elections must complete a voter registration application provided by the local jurisdiction and are not eligible to register as state or federal voters.

Verifying your registration

The Texas Secretary of State’s office allows residents to check their voter registration status online by visiting this website.

Voter ID requirements

Texas requires voters to present photo identification while voting.

The following list of accepted ID was current as of February 2023. Click here for the Texas Secretary of State's page on accepted ID to ensure you have the most current information.

• Texas driver’s license issued by the Texas Department of Public Safety (DPS)
• Texas Election Identification Certificate issued by DPS
• Texas Personal Identification Card issued by DPS
• Texas handgun license issued by DPS
• United States Military Identification Card containing the person’s photograph
• United States Citizenship Certificate containing the person’s photograph
• United States passport (book or card)

Identification provided by voters aged 18-69 may be expired for no more than four years before the election date. Voters aged 70 and older can use an expired ID card regardless of how long ago the ID expired.

Voters who are unable to provide one of the ID options listed above can sign a Reasonable Impediment Declaration and provide one of the following supporting documents:

• Copy or original of a government document that shows the voter’s name and an address, including the voter’s voter registration certificate
• Copy of or original current utility bill
• Copy of or original bank statement
• Copy of or original government check
• Copy of or original paycheck
• Copy of or original of (a) a certified domestic (from a U.S. state or territory) birth certificate or (b) a document confirming birth admissible in a court of law which establishes the voter’s identity (which may include a foreign birth document)

The following voters are exempt from showing photo ID:

• Voters with a disability
  • Voters with a disability "may apply with the county voter registrar for a permanent exemption to presenting an acceptable photo identification or following the Reasonable Impediment Declaration procedure in the county."
• Voters who have a religious objection to being photographed

Voters who do not have a photo ID can obtain a Texas Election Identification Certificate (EIC) at any Texas driver’s license office during regular business hours. Voters can also obtain an Election Identification Certificate from a mobile station. Locations are listed here.

See also

2025 ballot measures

View other measures certified for the 2025 ballot across the U.S. and in Texas.

• 2025 ballot measures
• Texas 2025 ballot measures
• Texas elections, 2025

Texas ballot measures

Explore Texas's ballot measure history, including constitutional amendments.

• List of Texas ballot measures
• Texas Historical Ballot Measures Factbook
• Taxes ballot measures
• Texas State Legislature

Legislative process

Understand how measures are placed on the ballot and the rules that apply.

• Legislatively referred constitutional amendment
• Texas Constitution
• Amending state constitutions

External links

• Text of SJR 18

Footnotes

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