The Parliament of Georgia unanimously approves the reduction of the state income tax and property tax.

In Georgia, changes to the tax legislation were made on Thursday aimed at reducing state income taxes and local property taxes. These measures were supported by Governor Brian Kemp and Speaker John Burns.

The proposed changes include an expansion of the already planned income tax reduction, an increase in the property tax exemption for property owners in certain areas, and an increase in the amount that parents can deduct from their annual taxable income for each child.

Tax cuts are usually popular among Republicans during election years, and in this case, all 236 seats in the State Duma and Senate will be up for vote this year. Despite the slowdown in the growth of state tax revenues, Georgia may suffer losses from tax cuts, as last budget year the state budget was planned for a smaller amount than the taxes collected, ending with a surplus of $10.7 billion.

139 members of the House voted 165-0 in favor of passing the Income Tax Reduction Act, sending it for further discussion in the Senate. Kemp and other Republican leaders support the measure to bring the state income tax back to 5.39%, which was 5.49% since December 2022. There are plans for an additional annual tax reduction of 0.1% until it reaches 4.99%. The tax reduction plan to 5.39%, announced in December, will cost an additional $300 million. This will be added to the $800 million expected to be saved from the previous tax cuts.

Members of the House also approved the Additional Income Tax Deduction Act, allowing taxpayers to deduct $4,000 instead of the current $3,000 for each dependent.

"Given the rising prices of food, childcare costs, and other expenses that parents are responsible for, this once again confirms that the residents of Georgia are looking for family-supportive policies, and we are at the forefront," said representative Lauren Daniel, a Republican from Locust Grove.

In addition, the members of the House unanimously voted for the Law on Reducing Local Property Taxes for certain homeowners. To pass this law in the Senate, a two-thirds majority will be required, and then it must be approved by voters in a referendum in November.

This law will increase the federal property tax exemption for all Georgia citizens from $2,000 to $4,000. Rep. Matt Reeves, a Republican from Duluth, stated that this could help homeowners save up to $100 a year on property taxes for local governments and schools.

“This law provides a good tax benefit at a time when it is necessary for people to buy their first home in Georgia,” said Reeves.

However, this law will not be applied in all counties. Some counties have their own local legislation regarding housing tax exemptions, which do not allow the use of federal exemptions alongside local ones. It is unclear how many homeowners will be affected by this measure, but House Republicans estimate that homeowners across the country will save less than $100 million a year.

The senators, in turn, intend to propose a plan that will limit the rate of growth of property valuations in order to set taxes, which could restrict future increases in property taxes.