AUSTIN (May 29, 2009)--The Texas House voted Friday to agree with the Senate and give a tax break to 40,000 small businesses.

Proposed changes to the state's franchise tax, which were approved in a 144-1 House vote Friday, go to Gov. Rick Perry, who has said he wants a tax cut for small companies.

Under current law, companies with less than $300,000 in annual revenue are exempt from paying the tax.

Now, those making as much as $1 million would be exempt, at least initially.

The tax cut is estimated to be $172 million over the coming two years.

Rep. Rene Oliveira, a Brownsville Democrat who sponsored the measure in the House, says the Legislature in the near future needs to revisit the entire franchise tax.