Georgia Lawmakers Aim to Restrict Soaring Taxation

Certain legislators in Georgia are exploring solutions to alleviate the burden of property taxes.

With rising home values leading to increased property taxes for Georgia homeowners, there is a growing push among state lawmakers to offer relief during this election year. The Senate Finance Committee of Georgia has scheduled a hearing for Monday to discuss a proposed bill that would limit the increase in a home’s value assessed for property tax purposes to 3% annually.

If approved, this limit would continue as long as the owner maintains a homestead exemption. However, the voters will have to approve the plan in a November referendum.

Republican House Speaker Jon Burns of Newington proposes doubling the state’s homestead tax exemption, which is expected to result in a reduction of tax bills by almost $100 million statewide. Lawmakers in several states are responding to voter discontent with higher levies, not just Georgia.

“Property taxes are likely to be the biggest tax issue in many states this year,” said Jared Walczak of the Tax Foundation, a group that researches taxes and is often critical of increases.

In November, Texas voters approved a plan to cut property taxes by $18 billion. Both Kansas’ Democratic governor and Republican-majority legislature now endorse larger exemptions for homeowners, aimed at cutting taxes by $100 million annually.

During a special session in November, Colorado lawmakers approved an increase in residential deductions and a decrease in assessment rates. Pennsylvania is utilizing lottery proceeds to reduce property taxes and subsidize rent for seniors and disabled individuals.

Supporters in Georgia are advocating for a cap on the taxable value of homes in order to prevent school districts, cities, and counties from increasing tax revenues by relying on rising home values.  Republican leaders have been urging local governments to reduce tax rates to keep bills steady.

In fact, they have even introduced legislation requiring advertisements that label a failure to do so as a tax increase. This move aims to keep taxes under control and prevent homeowners from being burdened by increasing property taxes.

Senate Bill 349’s sponsor, Finance Committee Chairman Chuck Hufstetler, claims that many school districts and governments are keeping the increased revenues that come from value appreciation.“I’ve seen some increases where, just in a couple of years, their collections have gone up 40%,” Hufstetler told The Associated Press on Friday.

“And they haven’t dropped the millage rate and they are using it for a backdoor tax increase. And I think there needs to be some moderation on that.”

Challenges and Implications of Georgia’s Rising Property Taxes

According to the Georgia Department of Revenue, property tax collections in the state increased by 41% between 2018 and 2022. During the same period, the total assessed value of both existing property and new buildings rose by almost 39%. However, it is important to note that these figures do not provide a clear indication of how much valuations increased specifically for existing properties.

Numerous governments and school districts have utilized the sudden increase in property values to boost employee salaries and cope with the rising expenses due to inflation. However, if property tax limits are imposed, it could restrict governments from increasing employee wages and force them to raise tax rates instead.

Several states, including California and Colorado, have accused property tax limits of hindering local governments.

According to the Association of County Commissions of Georgia, at least 39 counties, 35 cities, and 27 school systems in Georgia have implemented local laws that restrict the amount by which assessed value can increase. Some of those limits only benefit homeowners 65 or older.

Republican Lt. Gov. Burt Jones supports Hufstetler’s bill to prevent “large surprise increases in home values.” The bill is also backed by Atlanta Sen. Jason Esteves. Local caps in some Georgia communities can lead to long-term residents paying lower taxes compared to newcomers, as caps can hold down property values over time.

During a House committee meeting in October, Suzanne Widenhouse, the chief appraiser of the Muscogee County Board of Assessors, revealed that a homeowner in Columbus paid only $7.79 in property taxes last year while a neighbor with a similar house who had recently moved in paid $3,236.19. 

A neighbor paid less property tax due to Governor Brian Kemp’s $950 million rebate. Homestead exemptions in Columbus protect over $2 billion in property value from taxation, causing commercial and industrial property owners and renters to bear the tax burden. This creates inequality, as pointed out by Widenhouse.

Read more: Texas Man Admits to Kidnapping Teen Rescued in Southern California after ‘Help Me!’ Sign