Amidst a surge in home values leading to higher property taxes for many homeowners in Georgia, state lawmakers are responding with proposed measures to provide relief. In an election year, the Senate Finance Committee in Georgia is set to hold a hearing on Monday to discuss a bill that aims to limit annual increases in a home’s assessed value for property tax purposes to 3%. Simultaneously, Republican House Speaker Jon Burns suggests doubling the state’s homestead tax exemption, potentially reducing tax bills by nearly $100 million statewide.

Senate Finance Committee Weighs in on 3% Cap for Property Tax Assessments

The proposed Senate Bill 349, championed by Finance Committee Chairman Chuck Hufstetler, seeks to implement a 3% cap on increases in homes’ taxable values. This cap would remain in effect as long as homeowners maintain a homestead exemption, with voter approval required in a November referendum. Supporters argue that such a cap would prevent local entities from relying on rising property values to increase tax revenues, especially as statistics reveal a 41% rise in overall property tax collections in Georgia from 2018 to 2022.

Hufstetler contends that some school districts and governments have seen their collections surge by 40% within just a few years, without adjusting millage rates. The proposed cap aims to moderate such increases and ensure that local entities do not employ rising property values as a backdoor tax increase.

Republican House Speaker Proposes Doubling Homestead Tax Exemption for Statewide Relief

In addition to the Senate proposal, Republican House Speaker Jon Burns puts forward an alternative solution. Burns suggests doubling the state’s homestead tax exemption, potentially resulting in a substantial reduction of tax bills statewide, estimated at nearly $100 million. This measure would provide relief to homeowners facing the impact of rising property values, particularly in the context of the 41% increase in overall property tax collections over the last four years.

Balancing Relief and Local Control: The Debate on Property Tax Measures

The debate on how to address rising property taxes underscores a larger discussion about balancing relief measures with local control. While the Senate proposal aims to establish a statewide cap on property tax assessments, House leaders are more inclined to leave such decisions to local communities. House Ways and Means Committee Chairman Shaw Blackmon emphasizes the importance of preserving local control, signaling a divergence in approaches among lawmakers.

Concerns have been raised about the potential long-term impacts of a 3% cap, with arguments suggesting that it could result in long-term residents paying lower taxes than newcomers. The debate extends to the potential creation of inequality, as demonstrated in some Georgia communities where local caps have already led to disparities in property tax burdens.

As Georgia grapples with the complexities of property tax reforms, the outcome of these legislative proposals will significantly shape the landscape for homeowners and local entities alike, with the overarching goal of striking a balance between providing relief and maintaining local autonomy.