SB476: SB476 "Income Tax Reduction Act of 2026"; enact

Georgia currently phases its personal income tax rate down gradually toward 4.99%, with the pace tied to revenue triggers checked each December. This bill locks the rate at 4.99% starting with tax years beginning January 1, 2026, and removes the delay mechanism tied to state revenue estimates. It sets corporate and partnership income tax at the same 4.99% rate and raises the standard deduction to $100,000 for joint filers and $50,000 for single filers, up from the current $24,000 and $12,000. The bill also says that starting with tax years beginning January 1, 2032, no credits will be allowed against Georgia taxable income for corporations, fiduciaries, partnerships, or individuals, effectively sunsetting the credit system. Along the way it repeals or narrows many specific tax credits (for banks, medical equipment and PPE manufacturers, alternative fuel vehicles, business headquarters, port traffic increases, teleworking expenses, and more) and repeals several sales and use tax exemptions, such as those for aircraft, watercraft, motor vehicles, videotape rentals, and pollution-control equipment. Most provisions take effect January 1, 2027, though the income tax rate changes apply starting in 2026.

• Sets a flat 4.99 percent personal income tax rate for tax years starting January 1, 2026, removing the prior year-by-year rate-reduction schedule tied to state revenue conditions.
• Taxes corporations and partnerships at the same 4.99 percent rate as individuals instead of the former separate corporate rate.
• Raises the standard deduction from state taxable income to $100,000 for joint filers and $50,000 for single filers, up from $24,000 and $12,000.
• Bars any tax credit against Georgia taxable income for corporations, fiduciaries, partnerships, or individuals for tax years beginning on or after January 1, 2032.
• Repeals or eliminates numerous specific tax credits, including those for banks, PPE and medical equipment manufacturers, alternative fuel vehicles, business headquarters, port traffic increases, and teleworking expenses.
• Repeals several state sales and use tax exemptions, including those for aircraft, watercraft, certain motor vehicles, videotape rentals, pollution-control equipment, and boat repair, while honoring exemption certificates already issued.

Georgia individual income taxpayers, corporations, partnerships and S corporations filing state taxes, insurance companies and banks that currently claim premium or income tax credits, manufacturers of medical equipment and PPE, businesses claiming vehicle or headquarters credits, low-income housing developers, and buyers of aircraft, watercraft, and other goods that lose sales tax exemptions.

Georgians would see their income tax rate locked at 4.99 percent sooner and pay tax on a much larger standard deduction, likely lowering many people's tax bills. At the same time, businesses that rely on specific state tax credits or sales tax exemptions, from manufacturers to insurers to housing developers, would lose or see those benefits phased out by 2032.

• Section 2-1 sets the individual income tax rate at 4.99 percent for tax years beginning on or after January 1, 2026, removing the prior gradual step-down and its revenue-based delay triggers.
• Sections 2-2 and 2-3 tax corporations, S corporations, and electing partnerships at 4.99 percent, matching the individual rate.
• Section 2-4 raises the standard deduction to $100,000 (joint) and $50,000 (single, head of household, or married filing separately).
• Section 3-1 creates a new Code section barring any credit against Georgia taxable net income for corporations, fiduciaries, partnerships, or individuals starting in tax year 2032.
• Section 3-2 sets a December 31, 2031 repeal date for the low-income tax credit chapter (O.C.G.A. Chapter 7A of Title 48).
• Sections 4-1 and 4-2 cap the combined Georgia affordable housing tax credit at 50 percent of the federal housing credit for applications received on or after January 1, 2027, down from a full match.
• Part V (Sections 5-1 through 5-23) repeals numerous insurance premium tax credits, bank and manufacturer credits, and several sales and use tax exemptions, while letting existing exemption certificates remain valid under prior law.
• Section 6-1 sets the general effective date as January 1, 2027, except Part II's tax rate and deduction changes, which apply starting with the 2026 tax year (effective July 1, 2026, for most of Part II).

1. 2026-02-18House Second Readers (House)
2. 2026-02-17House First Readers (House)
3. 2026-02-12Senate Passed/Adopted (Senate)
4. 2026-02-12Senate Third Read (Senate)
5. 2026-02-12Senate Engrossed (Senate)
6. 2026-02-11Senate Read Second Time (Senate)
7. 2026-02-10Senate Committee Favorably Reported (Senate)
8. 2026-02-09Senate Read and Referred (Senate)

• Blake Tillery (R, SD-019)Primary sponsor
• Larry Walker (R, SD-020)
• Jason Anavitarte (R, SD-031)
• Chuck Hufstetler (R, SD-052)
• Randy Robertson (R, SD-029)
• Shawn Still (R, SD-048)
• Matt Brass (R, SD-006)
• Steve Gooch (R, SD-051)
• Max Burns (R, SD-023)
• Ricky Williams (R, SD-025)
• Chuck Payne (R, SD-054)
• Kay Kirkpatrick (R, SD-032)
• Carden Summers (R, SD-013)
• Timothy Bearden (R, SD-030)
• Jason T. Dickerson (R, SD-021)
• Drew Echols (R, SD-049)
• Sam Watson (R, SD-011)
• Russ Goodman (R, SD-008)
• Greg Dolezal (R, SD-027)
• Frank Ginn (R, SD-047)
• Bo Hatchett (R, SD-050)
• Bill Cowsert (R, SD-046)
• Ben Watson (R, SD-001)
• Mike Hodges (R, SD-003)
• John Albers (R, SD-056)
• Billy Hickman (R, SD-004)
• Clint Dixon (R, SD-045)
• Lee Anderson (R, SD-024)
• Brian Strickland (R, SD-042)
• Ed Setzler (R, SD-037)
• Marty Harbin (R, SD-016)
• David Lucas (D, SD-026)

1. PassedSenate voteFebruary 12, 2026

   31 yea, 21 nay (0 not voting, 2 absent)

   Motion To Engross: Sb 476, Sb 477: Senate Vote #542

2. PassedSenate voteFebruary 12, 2026

   32 yea, 18 nay (1 not voting, 3 absent)

   Passage: Senate Vote #543

• income tax rate
• standard deduction
• corporate tax
• tax credits repeal
• sales tax exemptions