The limit on property tax increases in Georgia, subject to voter approval.

Updated [hour]:[minute] [AM/PM] [time zone], [full month] [day], [year] ATLANTA (AP) — Georgia lawmakers finalized a package of legislative initiatives on Thursday that they hope will limit property tax increases, which could become a key tax cut for Republicans in the 2024 session. The measures include a constitutional amendment that will require voter approval in a November referendum before it can take effect. The plan aims to cap the increase in the assessed value of homes for property tax purposes to the rate of inflation each year, unless a municipal or county government or local school board takes advantage of a unique opportunity to opt out at the beginning of 2025.

Chairman of the Senate Finance Committee Chuck Huffstetler

A Republican fromRome called it "a massive tax legislation that will relieve the burden on taxpayers in the short term and, exceeding the limit, will lower their taxes in the long term." Lawmakers argue that this will prevent "secret" tax increases from governments that receive more revenue when home values rise without lowering tax rates. Many lawmakers claim that dissatisfaction with rising property tax bills is the main concern they hear from their constituents.

Statistics

It shows that total property tax collections in Georgia increased by 41% from 2018 to 2022, while the total assessed value rose by nearly 39%. These figures represent not only existing properties but also new buildings. House Resolution No. 1022 and Bill No. 581 were passed by the House and Senate, easily surpassing the two-thirds majority required. Lobbying groups for cities and counties agreed to the measure.

School advice

They are still opposing it, warning that the restriction could "pull" schools' necessary revenues in the future. This is especially true since most school districts cannot raise tax rates above a certain level, limiting their ability to increase revenue.

Georgia

Not the only state where lawmakers are responding to voter dissatisfaction over tax increases, other states, including Texas, Kansas, Colorado, and Pennsylvania, have seen this issue become central over the past year.

• According to the current proposal, local governments and school districts should be able to opt out by March 1, 2025.
• But any local government or school district that did not leave the plan will be governed by the restriction thereafter.

For homeowners with a housing exemption, this will remain in effect as long as they own their home. The assessed value will be reset to market value upon the sale of the house. Lawmakers also agreed to a proposal supported by House Speaker John Burns to increase the state tax exemption for residential properties. Burns, a Republican from Newington, proposed raising the amount from $2,000 to $4,000.

These changes could save some homeowners $100 annually on their tax bills by reducing the taxable value of their homes. However, this may only apply in one-third of the 159 counties in Georgia, the testimony showed. Most counties already have local exemptions that are either larger or do not qualify for the state exemption.

The bill also includes a new provision that would allow governments to increase sales taxes by a cent for every dollar of sales to replace property taxes. Several counties are already operating this way. Republicans in Georgia have long sought for local governments to lower tax rates so that bills remain at a level when property values increase, arguing that allowing bills to rise, even if tax rates remain the same, is equivalent to a hidden tax increase.

At least 39 counties in Georgia, 35 cities, and 27 school systems have enacted local laws limiting how much assessed values can increase, according to the Georgia Association of County Commissioners. Some of these restrictions apply only to homeowners aged 65 and older.