SB382: SB382 Ad Valorem Taxation; make the state-wide base year homestead exemption mandatory for all political subdivisions

Georgia currently lets local governments opt out of a state-wide homestead exemption that freezes a home's taxable value at a base year. This bill, titled the Homeownership Opportunity and Market Equalization Act of 2026, ends that opt-out and makes the exemption mandatory everywhere starting in 2027. It also changes how the exemption works: instead of freezing value, homeowners would get a flat percentage cut off their home's taxable value, rising from 10 percent in 2027 to 50 percent by 2031 and beyond. The bill also caps how fast local governments and school boards can grow property tax revenue. Starting January 1, 2027, if a proposed budget would raise property tax collections by more than 3 percent or the inflation rate, whichever is higher, voters must approve it in a referendum or the General Assembly must pass a special local law allowing it. The bill also adjusts local sales tax rate caps, changes how a special district sales tax for property tax relief is adopted, adds new sales tax reporting rules, and calls for a nonbinding statewide referendum in November 2026 asking whether voters should be allowed to decide on new local government financing methods for property tax relief.

• Converts the state-wide homestead exemption from a base year value freeze into a flat percentage reduction of a home's taxable value, phased from 10 percent in 2027 up to 50 percent by 2031 and after.
• Makes that homestead exemption mandatory for every county, city, consolidated government, and school system, ending the prior option for local governments to opt out.
• Requires voter approval, through a referendum, or a special act of the General Assembly before a local government or school board can raise property tax revenue faster than 3 percent or the inflation rate, whichever is greater, starting in 2027.
• Changes the local sales tax rate cap from 2 percent (through 2026) to 5 percent starting January 1, 2027, and requires sales tax returns to report where sales occurred and include industry classification codes.
• Switches the special district sales tax used for property tax relief (FLOST) from requiring a voter referendum to being adopted by resolution of local governing bodies.
• Directs the Secretary of State to hold a nonbinding, advisory statewide referendum in November 2026 asking Georgians whether the General Assembly should let voters decide on new local government finance methods for full property tax relief.

Homeowners statewide who claim a homestead exemption, county and city governments, local school boards, county tax commissioners and receivers, businesses that collect and remit sales tax, and voters who may face new referendums on local budget increases and a statewide advisory question.

Homeowners across Georgia would see their homestead tax break calculated differently and could no longer be excluded from it by local opt-out votes. Local governments and school boards would face new limits on how much they can raise property taxes without asking voters directly, changing how local budgets get built each year.

• Section 2-1 raises the local sales and use tax cap from 2 percent (through December 31, 2026) to 5 percent starting January 1, 2027, with specific carve-outs for transit and other existing taxes.
• Section 2-2 requires sales tax returns filed on or after January 1, 2027 to report collection locations by city or unincorporated county and to include industry classification codes.
• Sections 3-1 through 3-5 change the special district sales tax for property tax relief (FLOST) so it can be imposed by resolution of local governments instead of requiring a voter referendum, and adjust how proceeds are distributed and used.
• Section 4-1 rewrites the state-wide homestead exemption (O.C.G.A. 48-5-44.2) into a phased percentage reduction (10 percent in 2027 rising to 50 percent by 2031) and eliminates the local opt-out process, making it mandatory statewide beginning January 1, 2027.
• Section 5-1 excludes the value of homestead exemptions granted under this new provision from the equalized adjusted school property tax digest used to calculate state school funding formulas.
• Sections 5-2 through 5-4 require voter referendum or special legislative approval for local school boards and other local governments to raise property tax revenue beyond 3 percent or the inflation rate, starting January 1, 2027.
• Part VII calls for a nonbinding, advisory statewide referendum on the November 2026 ballot asking whether the General Assembly should let voters decide on new local finance procedures for full property tax relief.
• Section 9-1 states the Act takes effect once signed by the Governor or upon becoming law without the Governor's signature.

1. 2026-03-27House Committee Favorably Reported By Substitute (House)
2. 2026-03-25House Withdrawn, Recommitted (House)
3. 2026-03-20House Committee Favorably Reported By Substitute (House)
4. 2026-02-05House Second Readers (House)
5. 2026-02-04House First Readers (House)
6. 2026-02-03Senate Passed/Adopted By Substitute (Senate)
7. 2026-02-03Senate Third Read (Senate)
8. 2026-02-03Senate Engrossed (Senate)

• Chuck Hufstetler (R, SD-052)Primary sponsor
• John Albers (R, SD-056)
• Larry Walker (R, SD-020)
• Jason Anavitarte (R, SD-031)
• Bo Hatchett (R, SD-050)
• Randy Robertson (R, SD-029)
• Shawn Still (R, SD-048)
• Clint Dixon (R, SD-045)
• Carden Summers (R, SD-013)
• Billy Hickman (R, SD-004)
• Ben Watson (R, SD-001)
• Kay Kirkpatrick (R, SD-032)
• Jason T. Dickerson (R, SD-021)
• Mike Hodges (R, SD-003)
• Chuck Payne (R, SD-054)
• Drew Echols (R, SD-049)
• Brian Strickland (R, SD-042)
• Ricky Williams (R, SD-025)
• Sam Watson (R, SD-011)
• Matt Brass (R, SD-006)
• Lee Anderson (R, SD-024)
• Marty Harbin (R, SD-016)
• Greg Dolezal (R, SD-027)
• Steve Gooch (R, SD-051)
• Blake Tillery (R, SD-019)
• Shaw Blackmon (R, HD-146)

1. PassedSenate voteFebruary 3, 2026

   31 yea, 22 nay (0 not voting, 1 absent)

   Motion To Engross: Senate Vote #511

2. PassedSenate voteFebruary 3, 2026

   31 yea, 19 nay (3 not voting, 1 absent)

   Passage By Substitute: Senate Vote #513

3. PassedSenate voteFebruary 3, 2026

   30 yea, 20 nay (3 not voting, 1 absent)

   Motion To Immediately Transmit: Senate Vote #514

• property taxes
• homestead exemption
• local government budgets
• sales tax rates
• property tax referendum