Would cap the increase in taxable value of homes in Georgia if voters approve

ATLANTA (AP) – Georgia Lawmakers on Thursday gave final approval to a package of legislation they hope will limit property tax increases, which could be Republicans’ signature tax cut effort of the 2024 session.

The measures include a state constitutional amendment that would require voter approval in a November referendum before taking effect.

The plan would limit the increase in home value as assessed for property tax purposes to the rate of inflation each year, unless a city or county government or local school board uses a one-time escape clause to opt out beginning in 2025. Does not use hatch.

Senate Finance Committee Chairman Chuck Hufstetler, a Rome Republican, called it “a tremendous piece of tax legislation to give taxpayers relief in the short term and, in the long term, keep their taxes lower.”

Lawmakers say failing to lower tax rates would prevent “backdoor” tax increases by governments, which capture more revenue when home values ​​rise. Many General Lawmakers Say Dissatisfaction Over Rising Property Tax Bills The biggest concerns they hear from constituents, Statistics show that overall Georgia property tax collections increased 41% from 2018 to 2022, with total assessed value increasing nearly 39%. Those figures represent not only existing property but also new buildings.

House Resolution 1022 and House Bill 581 passed the House and Senate, easily meeting the required two-thirds majority. Lobby groups from cities and counties had agreed to the measure. School boards nevertheless opposed it and warned that this limit could cause schools to lose needed revenue in the future. This is especially true because most school districts cannot raise tax rates above a certain amount, limiting their ability to raise new revenue.

is georgia far from the only state Where lawmakers are responding to voter dissatisfaction with high fees, including states texasThe issue took center stage in Kansas, Colorado and Pennsylvania over the past year.

senators had wanted to make cap mandatory for each city, county and school district that doesn’t already have a more restrictive limit, while House members proposed allowing governments to choose the option. Under the current proposal, local governments and school districts would have until March 1, 2025. choose. But any local government or school district that did not opt ​​out of the plan would then be governed by the limits.

For homeowners with the homestead exemption, this lasts as long as they own their home. When a home is sold the appraised value will reset to market value.

House members abandoned a proposal backed by House Speaker John Burns to extend the statewide homestead tax exemption. Burns, a Newington Republican, proposed increasing the amount. $2,000 to $4,000, This could save some homeowners $100 per year on tax bills by reducing the taxable value of the home. But this may not be applicable in all counties.

The bill includes a new provision that would allow governments to raise sales taxes by up to a penny on $1 of sales to replace property taxes. Some counties are already doing this.

Republicans in Georgia have long pressured local governments to roll back tax rates to keep bills at the level as assessments rise, saying that allowing bills to rise even if tax rates remain at the same level. Similar to a backdoor tax increase. According to the Association of County Commissions of Georgia, at least 39 Georgia counties, 35 cities and 27 school systems have adopted local laws limiting how much assessed values ​​can increase. Some of those limits only benefit homeowners age 65 or older.

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