HB1285: HB1285 Sales and use tax; limit number of local sales and use taxes by authorizing counties; revise provisions

Georgia law generally caps combined local sales and use taxes at 2 percent in any area, with certain taxes excluded or grouped into smaller sub-caps under O.C.G.A. § 48-8-6. This bill rewrites part of that cap calculation in Section 48-8-6(a)(1) by adding a reference to Code Section 48-8-97, which covers the enhanced homestead option sales tax (a local sales tax that funds property tax relief for homeowners), to the list of taxes grouped together under the existing 1 percent aggregate sub-limit. By folding the enhanced homestead option sales tax into that same 1 percent bucket alongside other taxes such as those under Article 2A, Article 2B, and certain water and sewer taxes, the bill effectively allows counties more room to levy both an enhanced homestead option sales tax and a local option sales tax without exceeding the overall 2 percent statewide ceiling. The bill repeals any conflicting laws and does not state a delayed effective date beyond the standard process for Georgia legislation.

• Adds Code Section 48-8-97 (the enhanced homestead option sales tax) to the list of taxes counted together under the 1 percent aggregate sub-cap in O.C.G.A. § 48-8-6(a)(1).
• Changes how the overall 2 percent statewide cap on local sales and use taxes is calculated for counties that levy an enhanced homestead option sales tax.
• Effectively creates more room for a county to layer an enhanced homestead option sales tax together with a local option sales tax under the same 2 percent ceiling.
• Leaves in place the existing exemptions for the 1 percent education sales tax and the 1 percent transportation-related tax aggregate under subparagraphs (A) and (B).
• Repeals any state laws that conflict with the revised cap calculation.

Georgia county governments deciding whether to adopt an enhanced homestead option sales tax, homeowners who benefit from the property tax relief that tax funds, and local taxpayers who pay combined local sales taxes, since the change affects how much total local sales tax a county can charge.

Because Georgia limits combined local sales taxes to 2 percent, how taxes are grouped for that calculation determines whether a county can adopt new local taxes at all. This change gives counties more flexibility to fund homestead property tax relief through sales tax without necessarily giving up a local option sales tax.

• Section 1 amends O.C.G.A. § 48-8-6(a)(1), which sets the general 2 percent statewide cap on local sales and use taxes in any jurisdiction.
• Subparagraph (C) is revised to add Code Section 48-8-97 to the group of taxes subject to the existing 1 percent aggregate sub-limit, alongside Code Section 48-8-96, Article 2A, Article 2B, Part 3 of Article 3, and Article 4.
• Subparagraphs (A) and (B), covering the education sales tax exemption and the transportation tax aggregate, remain unchanged.
• Section 2 repeals any conflicting state laws.

1. 2026-03-09Senate Read and Referred (Senate)
2. 2026-03-06House Passed/Adopted (House)
3. 2026-03-06House Third Readers (House)
4. 2026-03-06House Committee Favorably Reported (House)
5. 2026-02-17House Second Readers (House)
6. 2026-02-12House First Readers (House)
7. 2026-02-11House Hopper (House)

• Mike Cheokas (R, HD-151)Primary sponsor
• Ron Stephens (R, HD-164)
• Carter Barrett (R, HD-024)
• Noel Williams (R, HD-148)
• Soo Hong (R, HD-103)
• Charles Cannon (R, HD-172)

1. PassedHouse voteMarch 7, 2026

   98 yea, 58 nay (3 not voting, 18 absent)

   Passage: House Vote #688

• sales tax
• property tax relief
• local government finance
• homestead exemption
• county taxes