Tex. Transportation Code § 502.003: REGISTRATION BY POLITICAL SUBDIVISION PROHIBITED.

(a) Except as provided by Subsection (b), a political subdivision of this state may not require an owner of a motor vehicle to:

(1) register the vehicle;

(2) pay a motor vehicle registration fee; or

(3) pay an occupation tax or license fee in connection with a motor vehicle.

(b) This section does not affect the authority of a municipality to:

(1) license and regulate the use of motor vehicles for compensation within the municipal limits; and

(2) impose a permit fee or street rental charge for the operation of each motor vehicle used to transport passengers for compensation, other than a motor vehicle operating under a registration certificate from the department or a permit from the federal Surface Transportation Board.

(c) A fee or charge under Subsection (b) may not exceed two percent of the annual gross receipts from the vehicle.

(d) This section does not impair the payment provisions of an agreement or franchise between a municipality and the owners or operators of motor vehicles used to transport passengers for compensation.

Acts 1995, 74th Leg., ch. 165, Sec. 1, eff. Sept. 1, 1995. Amended by Acts 1997, 75th Leg., ch. 165, Sec. 30.45, eff. Sept. 1, 1997.