--- title: HB 111. Income tax; reduce rate of tax collection: bills id: 2025-2026/hb111 cite_as: HB 111, 2025-2026 Regular Session (Ga.) canonical_url: https://georgiacommons.org/bills/2025-2026/hb111 md_url: https://georgiacommons.org/bills/2025-2026/hb111.md text_url: https://georgiacommons.org/bills/2025-2026/hb111/text source_url: https://www.legis.ga.gov/legislation/69464 date: 2025-04-15 status: passed corpus_version: bills-2026-08-28 license: Public record of the Georgia General Assembly, via LegiScan; see about.md publisher: Georgia Commons, an independent project of Georgia Civic Data. Not the State of Georgia. Not legal advice. up: https://georgiacommons.org/bills/2025-2026.md previous: https://georgiacommons.org/bills/2025-2026/hb110.md next: https://georgiacommons.org/bills/2025-2026/hb112.md index: https://georgiacommons.org/bills/index.md omitted: votes and history omitted_chars: 1282 omitted_url: https://georgiacommons.org/bills/2025-2026/hb111.md?full=1 bill_number: HB 111 session: 2025-2026 Regular Session session_slug: 2025-2026 chamber: House bill_type: bill status_date: 2025-04-15 last_action: Effective Date 2025-07-01 sponsors: - Soo Hong - Matthew Gambill - Lauren McDonald - Will Wade - Bruce Williamson - Shaw Blackmon - Bo Hatchett text_version: Enrolled has_text: true legiscan_url: https://legiscan.com/GA/bill/HB111/2025 upstream_id: 1929452 summaries_model: claude-sonnet-5 topic_tags: - income tax - tax rate cuts - Georgia state budget - personal finance --- # HB 111. Income tax; reduce rate of tax ## Text 25 LC 59 0028-EC/AP House Bill 111 (AS PASSED HOUSE AND SENATE) By: Representatives Hong of the 103rd, Gambill of the 15th, McDonald III of the 26th, Wade of the 9th, Williamson of the 112th, and others A BILL TO BE ENTITLED AN ACT To amend Article 2 of Chapter 7 of Title 48 of the Official Cod e of Georgia Annotated,1 relating to the imposition, rate, computation, exemptions, and credits relative to income2 taxes, so as to reduce the rate of the tax; to provide for rela ted matters; to provide for an3 effective date and applicability; to repeal conflicting laws; and for other purposes.4 BE IT ENACTED BY THE GENERAL ASSEMBLY OF GEORGIA:5 SECTION 1.6 Article 2 of Chapter 7 of Title 48 of the Official Code of Georgia Annotated, relating to the7 imposition, rate, computation, exemptions, and credits relative to income taxes, is amended8 by revising subsection (a.1) of Code Section 48-7-20, relating to individual tax rates, credit9 for withholding and other payments, and applicability to estates and trusts, as follows:10 "(a.1)(1) On and after January 1, 2024 2025, the tax imposed pursuant to subsection (a)11 of this Code section shall be 5.39 5.19 percent for taxable years beginning on or after12 January 1, 2024 2025; provided, however, that such rate shall be reduced by 0.10 percent13 annually beginning on January 1, 2025 2026, until the rate reaches 4.99 percent, provided14 that such annual reductions in the tax rate shall be subject to del ays as provided in15 paragraph (2) of this subsection.16 H. B. 111 - 1 - 25 LC 59 0028-EC/AP (2) Each prospective annual reduction in the tax rate that wou ld otherwise occur as17 provided in paragraph (1) of this subsection shall be delayed by one year for each year18 that any of the following are true as of December 1:19 (A) The Governor's revenue estimate for the succeeding fiscal year is not at least 320 percent above the Governor's revenue estimate for the present fiscal year;21 (B) The prior fiscal year's net revenue collection was not hig her than each of the22 preceding three fiscal years' net tax revenue collection; or23 (C) The Revenue Shortfall Reserve provided for in Code Section 45-12-93 does not24 contain a sum that exceeds the amount of the decrease in state revenue projected to25 occur as a result of the prospective reduction in the tax rates set to occur the following26 year.27 (3) The Office of Planning and Budget shall make the determina tions necessary to28 implement the provisions of paragraph (2) of this subsection an d shall report its29 determinations by December 1 of each year to the department, the Speaker of the House30 of Representatives, the President of the Senate, and the chairp ersons of the House31 Appropriations Committee, the House Ways and Means Committee, t he Senate32 Appropriations Committee, and the Senate Finance Committee. This paragraph shall not33 be applicable after the final reduction to the rate of 4.99 percent occurs."34 SECTION 2.35 This Act shall become effective on July 1, 2025, and shall appl y to all taxable years36 beginning on or after January 1, 2025.37 SECTION 3.38 All laws and parts of laws in conflict with this Act are repealed.39 H. B. 111 - 2 - ## Summaries written by Georgia Commons The following was written by claude-sonnet-5 from the text above and is not part of the bill. Quote the text, not the summary. House Bill 111 lowers Georgia's flat state income tax rate from 5.39 percent to 5.19 percent starting with the 2025 tax year, continuing a planned series of annual rate cuts. ### Plain-language summary Georgia currently taxes individual income at a flat 5.39 percent rate, with a law already on the books calling for that rate to drop gradually each year until it reaches 4.99 percent. This bill speeds that process along for 2025 by setting the rate at 5.19 percent for taxable years beginning on or after January 1, 2025, rather than the previously scheduled 5.39 percent. The bill keeps the existing structure that can delay future annual 0.10 percent reductions if state revenue growth, prior year tax collections, or the state's Revenue Shortfall Reserve fund do not meet certain benchmarks, as checked each December 1 by the Office of Planning and Budget. The law would take effect July 1, 2025, and apply to tax years starting on or after January 1, 2025. ### What it does - Lowers Georgia's flat individual income tax rate from 5.39 percent to 5.19 percent for taxable years beginning on or after January 1, 2025. - Keeps in place the existing plan for the rate to fall by 0.10 percent each year afterward until it reaches 4.99 percent. - Preserves the rule letting the Governor and Office of Planning and Budget delay a scheduled annual rate cut by a year if revenue growth, prior collections, or the state's reserve fund fall short of set benchmarks. - Requires the Office of Planning and Budget to report its yearly determinations on rate delays to the Department of Revenue, legislative leaders, and key House and Senate committees by December 1. - Sets the law to take effect July 1, 2025, applying retroactively to tax years starting January 1, 2025. ### Who it affects All Georgia individual income taxpayers, since the bill changes the statewide flat tax rate. It also affects the Department of Revenue, the Office of Planning and Budget, and legislative committees involved in tracking and reporting on the rate reduction schedule. ### Why it matters Because Georgia uses a flat income tax rate, this change affects nearly every wage earner and taxpayer in the state, slightly reducing the amount of state income tax owed starting with the 2025 tax year, while leaving open the possibility that future scheduled cuts could be delayed if state revenues underperform. ### Key provisions - Section 1 amends O.C.G.A. ยง 48-7-20(a.1) to set the individual income tax rate at 5.19 percent for taxable years beginning on or after January 1, 2025, down from the previously enacted 5.39 percent. - Section 1 keeps the annual 0.10 percent rate reduction schedule beginning January 1, 2026, continuing until the rate reaches 4.99 percent. - Paragraph (2) allows each scheduled annual reduction to be delayed a year if the Governor's revenue estimate growth, prior fiscal year collections, or the Revenue Shortfall Reserve fail to meet specified thresholds. - Paragraph (3) requires the Office of Planning and Budget to report its determinations by December 1 each year to the Department of Revenue and specified legislative leaders and committees. - Section 2 sets the effective date as July 1, 2025, applying to taxable years beginning on or after January 1, 2025. - Section 3 repeals conflicting laws. ## Status - Status: Passed (2025-04-15) - Last action: Effective Date 2025-07-01 (2025-04-15) - Sponsors: Soo Hong, Matthew Gambill, Lauren McDonald, Will Wade, Bruce Williamson, Shaw Blackmon, Bo Hatchett - Official page: https://www.legis.ga.gov/legislation/69464 > The history, votes, and amendments (1,282 characters) are at https://georgiacommons.org/bills/2025-2026/hb111.md?full=1