Taxation

HR 1114 — DID NOT CROSS Constitutional Amendment: Homeownership and Market Equalization Act of 2026

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GMA Position: Working with Author

GMA Summary

The committee substitute to HR 1114, LC 33 9898S

House Resolution 1114 is the constitutional amendment allowing for the elimination of property taxes statewide. It is accompanied by the enabling legislation, House Bill 1116 known as the, ‘Homeownership and Market Equalization Act of 2026'. The substitute to HR 1114, LC 33 9898S is in sections as follows:

Section 1: The resolution reduces the assessed valuation of homestead property from 40% to 10% of appraised value in increments of 3% over 10 years beginning in tax year 2027. Local governments, including local schools, would have the option to accelerate this reduction. Local governments that calculate assessed value of properties at a rate other than 40%, beginning in 2027, would reduce the percentage of appraised value by a total of 75% over 10 years in equal increments each year.

Section 2: The resolution provides for a 100% disabled veterans' homestead property tax exemption for 100% disabled veterans using the property as their primary residence.

Section 3: The resolution allows the General Assembly to authorize local governments and local school systems to establish local grant programs and appropriate local tax funds in support of local homeowner's incentive adjustments. The resolution also removes the adjustment homestead exemption equivalent cap of $18,000. Allows the General Assembly to appropriate grants to local governments to replace lost revenue due to reduced homestead property assessment levels. Also allows the General Assembly to dedicate proceeds from sales taxes collected on high-technology data centers to fund the grants.

Section 4: Limits the total rate of the sales tax for educational purposes to 2 percent. Allows any sales tax for educational purposes that is in place by January 1, 2028 to be converted.

Section 5: Allows for a local homestead option sales tax (LHOST) to be enacted by any city, county, consolidated government, or school board to offset the exemption of property subject to a homestead exemption by local governments. The LHOST would be no more than 2 percent for school boards and no more than 1 percent for counties, cities, and consolidated governments. The General Assembly may require the implementation or renewal of a LHOST after January 1, 2037 be approved by voters in a local referendum. If the referendum fails, homestead properties will be assessed at 40% of appraised value.

Section 6: Ballot language for the constitutional amendment.