ABC Texas Testimony on SB 2020

Testimony of Geoffrey Tahuahua, President Associated Builders and Contractors of Texas, before the Texas State Senate Committee on Finance

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Chairwoman Huffman, members of the Committee:

Thank you for the opportunity to testify today. My name is Geoffrey Tahuahua, and I serve as President of Associated Builders and Contractors of Texas, representing more than 1,600 merit shop contractors across the state. I'm here today to testify in strong support of Senate Bill 2020 by Senator Campbell, which would repeal the state’s tax on commercial rehabilitation and remodeling—what we commonly refer to as the "Rehab Tax."

This tax is burdensome, outdated, and counterproductive. While new commercial construction is exempt from sales tax on labor, renovation and remodeling projects are not. That means a small business owner trying to upgrade a building that’s been part of their community for decades is taxed more heavily than a developer breaking ground on a brand-new property.

This unequal treatment creates a clear disincentive for revitalizing aging commercial buildings. It punishes the property owner who wants to bring their facility up to modern codes, improve energy efficiency, or simply make their building more usable. And in areas like South and East Texas—where existing building stock is aging fast—this policy actively discourages much-needed investment.

SB 2020 would level the playing field. It would help local contractors, small businesses, and communities modernize safely and affordably—without navigating an arbitrary tax barrier. Eliminating the Rehab Tax will promote fair competition, encourage revitalization, and support sustainable growth across Texas.

We respectfully urge your support and passage of SB 2020.

Thank you, and I’m happy to answer any questions.