Montana Lawmakers Advance Property Tax Reform Bill Amid Criticism
HELENA – As the Montana Legislature nears the conclusion of its 2025 session, lawmakers are working on property tax reform through two key bills: Senate Bill 542 (SB 542) and House Bill 231 (HB 231). Both bills entered a conference committee on Tuesday morning aimed at reconciling discrepancies resulting from differing interpretations between the House and Senate.
SB 542 introduces “homestead” property tax rates, reducing taxes on primary residences, long-term rentals, and small commercial properties, while increasing rates on ineligible properties. Additionally, it provides a one-time rebate of up to $400, though implementation for the current year will be delayed. In contrast, HB 231 was significantly revised to serve as supporting legislation for SB 542, simplifying the alternate tax structure proposed by the latter.
During discussions, several business and agricultural leaders voiced concerns that the bills merely shift the tax burden rather than provide actual relief, threatening investment in the state. Todd O’Hair, CEO of the Montana Chamber of Commerce, highlighted the potential for increased complexity within an already intricate system.
Proponents argue that these measures are necessary to balance the disproportionate tax burden that has shifted toward residential properties since 2023 due to escalating property values. Rep. Llew Jones stated, “We have to acknowledge that something must be done,” reflecting the necessity for reform.
Ultimately, both bills received preliminary approval from the Senate, with votes of 28-22 for HB 231 and 29-21 for SB 542. Despite pending final votes scheduled for Wednesday, some lawmakers, like Sen. Greg Hertz, expressed concerns about hasty amendments and the desire for a reevaluation. Nonetheless, supporters, including Sen. Wylie Galt, emphasized the potential benefits for Montana residents.
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