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Nationwide voter revolt over property taxes collides with reality that every other revenue source has been slashed already

By
Jeff Amy
Jeff Amy
and
The Associated Press
The Associated Press
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By
Jeff Amy
Jeff Amy
and
The Associated Press
The Associated Press
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March 4, 2026, 8:09 AM ET
property
Real estate signs are posted outside homes for sale, Feb. 21, 2023, in Valrico, Fla. AP Photo/Phelan M. Ebenhack, File

More and more states are examining plans to cut property taxes during what’s an election year for governors and legislators in most states. But some states’ tax-cutting zeal is hitting political resistance to slashing local government and public school funding.

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National experts say it’s a property tax revolt — comparing it to earlier backlashes, including the one that led to California’s Proposition 13, a 1978 initiative that limited property tax rates and how much local governments could increase property valuations on homes for tax purposes. Like then, rising home values have driven higher property tax bills.

“The overwhelming trend across the states is relief for residential property owners,” said Manish Bhatt of the Tax Foundation, a Washington, D.C., group that studies taxes.

New proposals have been debated in recent weeks to cut taxes in Iowa, Kansas, Michigan, Missouri, Oklahoma, South Dakota and Wisconsin. In some of those states, the debate is likely to play out for months.

While political pressure from angry homeowners is likely to keep some legislatures on track to cut property taxes, efforts to eliminate property taxes on a homeowner’s primary residence face a difficult path.

Elimination may not be realistic

In Georgia on Tuesday, a state constitutional amendment that could have cut property taxes for homeowners by 75% or more failed when all but one Democrat voted against it. Because such amendments in Georgia require a two-thirds vote by legislators, the plan backed by Republican state House Speaker Jon Burns needed at least 21 Democratic votes.

The Georgia bill could be revived, but House Republicans said they would also begin looking at more limited ways to provide property tax relief that wouldn’t require a constitutional amendment.

In Florida, House lawmakers passed a proposed state constitutional amendment to phase out property taxes for nonschool purposes over 10 years. The proposal, which would cost an estimated $13 billion in forgone revenue, awaits Senate action. But a key state senator has signaled that his chamber is unlikely to agree, instead saying senators favor something less generous and more tailored to the needs of individual counties. Lawmakers have said it may take a special session to reach a deal.

Thomas Brosy, a senior research associate at the Urban-Brookings Tax Policy Center, said eliminating property taxes is “very unlikely to happen.”

“Completely slashing them is really unrealistic, since it really is the largest source of on revenues for most local governments in the United States,” Brosy said.

Georgia falls back from total elimination

Even the plan rejected Tuesday in Georgia was a step back from the original plan to phase out homeowner property taxes by 2032. Tuesday’s version would have cut, but not necessarily eliminated, property taxes on a primary residence, while encouraging local governments and schools to instead rely on sales taxes to fund operations. It would also have raised taxes on sales of computers to data centers to offset some revenue losses.

State House Ways and Means Committee Chairman Shaw Blackmon said the measure would have provided “dramatic savings for homeowners.”

“We’ve all received emails from constituents worried their skyrocketing property tax will force them from their homes,” he said in a debate on Tuesday.

But state House Democratic Minority Leader Carolyn Hugley called the bill an election-year “exercise in cold, hard politics.” She and other Democrats said that in many cases, local governments wouldn’t be legally able to raise sales taxes enough to offset the billions in property taxes that would be lost.

“The math’s just not math-ing. It just does not add up,” Hugley said. “And this is not a responsible thing to do.”

Sales tax shifts

Other states are looking at shifting from property taxes to sales taxes as well. South Dakota Gov. Larry Rhoden proposes letting counties impose a half-percent sales tax and devoting the proceeds to property tax credits for homeowners. Last week, Rhoden, a Republican, launched a website estimating how much homeowners would save annually on property taxes, ranging from $428 to $1,227. However, it doesn’t count how much people would pay from increased sales taxes.

In Michigan, Republican state House Speaker Matt Hall last week proposed raising taxes on currently untaxed services and using the money to erase the state’s share of property taxes, the state real estate transfer tax and Michigan’s personal property tax. Any agreement may not come until lawmakers finalize the state budget in the fall.

One issue with a shift to sales taxes is that it may shift the tax burden from richer to poorer people, Brosy with the Urban-Brookings Tax Policy Center said.

“They try to get it to the next best thing or the next available thing, which is the sales tax, which in itself is a lot more regressive and tends to fall a lot more on lower-income families compared to the property tax,” he said.

Another issue with shifting to sales taxes is that some local governments have few sources of retail sales to tax.

“Not all locations have the same opportunities to replace that revenue,” Bhatt of the Tax Foundation said. “And that often is missed in the discussions.”

The Fortune 500 Innovation Forum will convene Fortune 500 executives, U.S. policy officials, top founders, and thought leaders to help define what’s next for the American economy, Nov. 16-17 in Detroit. Apply here.
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