This resolution proposes a constitutional amendment to authorize a state-collected sales and use tax whose proceeds are distributed to county and consolidated governments to produce property tax relief. The measure specifies how proceeds are allocated among local governments and the priority order for spending those proceeds.
The amendment would change the balance of local revenue sources by directing consumption tax receipts toward reducing ad valorem taxes on real property. That shift alters who pays for local services, creates new administrative responsibilities for the state and counties, and embeds the mechanism in the state constitution rather than ordinary statute.
At a Glance
What It Does
The amendment authorizes a state-wide sales and use tax imposed at 1 percent, collected by the state under existing sales-tax authority, and paid annually to counties and consolidated governments on the basis of population as shown by the most recent U.S. decennial census. Local governing authorities must apply proceeds first to reduce residential homestead ad valorem taxes dollar-for-dollar, then to other real property, and only afterward to any other local purposes.
Who It Affects
Primary actors are county and consolidated governments (as revenue recipients), residential homestead property owners (first in line for relief), all consumers in Georgia who will pay the 1 percent on taxable purchases (including sales of food and beverages to the extent currently exempt), and businesses that collect and remit sales taxes. The state Department of Revenue or its designee would administer collection and distribution.
Why It Matters
The amendment shifts revenue responsibility from property owners toward a broad consumption tax base and locks the mechanism into the state constitution, reducing legislative flexibility. It also overrides certain statutory limits and exemptions, raising distributional, administrative, and equity questions that will matter to local finance officials, tax administrators, and compliance officers.
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What This Bill Actually Does
The proposed amendment creates a constitutionally authorized, state-collected sales and use tax dedicated to reducing local ad valorem taxes on real property. The tax is levied in the same way as Georgia's existing state sales and use tax and the state is the collector and payer: it gathers the receipts and sends annual allocations to counties and consolidated governments.
Allocations are computed using the population figures from the most recent U.S. decennial census rather than current population estimates.
Once a county receives its share, the county must apply the money in a strict sequence: first to decrease ad valorem taxes on residential homestead property on a dollar-for-dollar basis; second, if revenues exceed the amount needed to fully offset homestead taxes, to reduce ad valorem taxes on other real property; and third, any remaining funds may be used for other local purposes at the governing authority's discretion. The amendment requires the state to make annual payments to local governments; it does not tie those payments to local decisions about millage rates beyond the dollar-for-dollar reduction requirement.The amendment also changes the interaction with current local-sales-tax rules: it expressly states that this tax does not count against statutory maximums on local sales taxes and that it is not subject to any statutory exemption for sales or use of food and beverages.
Finally, while the amendment authorizes the General Assembly to pass implementing general law, it permits the tax to be imposed, levied, and collected under the constitutional provision without further legislative action. The resolution provides for voter ratification consistent with Georgia constitutional procedures.
The Five Things You Need to Know
The amendment sets the new tax rate at exactly 1 percent and directs that it be levied in the same manner as the state sales and use tax under Title 48, Article 1, Chapter 8.
Proceeds are distributed annually by the state to county and consolidated governments on a population basis determined by the most recent U.S. decennial census, not by interim estimates.
Local governments must apply proceeds in priority order: (1) fully offset residential homestead ad valorem taxes dollar-for-dollar; (2) then reduce all other real property ad valorem taxes if funds remain; (3) then spend any leftover funds for other local purposes.
The constitutional provision says the tax is not subject to statutory caps on local sales and use taxes and is not exempted by any law that exempts food and beverages from sales tax.
The General Assembly may adopt implementing legislation, but the amendment allows the tax to be imposed and collected under the constitutional grant without additional legislative action.
Section-by-Section Breakdown
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Legislative findings framing the amendment
This opening section records the General Assembly’s policy rationale: shifting part of the local funding burden from property owners to a broader tax base and preventing property-tax-driven displacement. The practical effect is to present the measure as a relief mechanism for homeowners, which can be important context for courts or implementers interpreting ambiguous language later.
Authorization and mechanics of the 1% sales and use tax
Paragraph (a) adds a constitutional grant to impose, levy, and collect a sales and use tax at a 1 percent rate, tied to the mechanics of Georgia's existing state sales-tax statute. That linkage imports existing collection rules, distinctions between sales and use tax, and administrative processes into the new levy, reducing the need for new collection mechanisms but also pulling in whatever complexities currently live in Title 48.
State collection and population-based distribution; required spending sequence
Paragraph (b) directs the state to collect the tax and pay proceeds annually to county and consolidated governments based on the most recent decennial census population figures. Paragraph (c) imposes mandated spending priorities: first to eliminate residential homestead ad valorem taxes dollar-for-dollar; second to reduce other real-property ad valorem taxes; third for any remaining local uses. Practically, counties will receive earmarked money but must change how they set millage and report revenue reductions to ensure the constitution’s dollar-for-dollar requirement is met.
Interaction with local sales taxes, caps, and exemptions
These subsections say explicitly that this tax does not prevent the state or localities from imposing other authorized local sales taxes, that this tax does not count toward statutory maximums on local sales taxes, and that it is not subject to any statutory exemption for sales or use of food and beverages. The net effect is to create a layer of consumption taxation that sits outside existing cap and exemption rules, which raises both administrative and equity questions for tax administrators and policymakers.
Implementation authority
Paragraph (g) allows the tax to be imposed without further legislative action but authorizes the General Assembly to define and implement the amendment by general law. That dual structure means immediate constitutional authorization exists, but the legislature can still supply technical definitions, reporting requirements, enforcement mechanisms, and any reconciliation procedures it considers necessary.
Submission of the amendment to voters
This procedural section provides the exact ballot language and directs submission to voters per Georgia’s constitutional amendment process. It does not alter substantive terms but is necessary to make the change operative if ratified by the electorate.
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Explore Finance in Codify Search →Who Benefits and Who Bears the Cost
Every bill creates winners and losers. Here's who stands to gain and who bears the cost.
Who Benefits
- Residential homestead property owners in counties that receive significant per-capita sales-tax receipts: they are first in line for dollar-for-dollar property tax reductions, which can directly lower annual property tax bills.
- County and consolidated governments: they gain a dedicated, constitutionally protected revenue stream that can be used to reduce property taxes and, if surplus exists, to fund other local priorities.
- Homeowners at risk of displacement due to high property taxes: the priority for homestead relief targets this group and may stabilize some households in high-tax areas.
Who Bears the Cost
- Georgia consumers, including low- and moderate-income households: a 1 percent increase in taxable consumption raises costs for everyone, and because the amendment removes any food/beverage exemption for this tax, it is regressive in impact unless counties offset it with progressive uses of remaining funds.
- Retailers and other businesses that collect sales tax: they must administer and remit the new tax and adjust point-of-sale systems and compliance procedures.
- State tax administration: the Department of Revenue (or equivalent) bears new responsibilities for collecting, allocating, reconciling, and defending distributions; that may require personnel, system changes, and budget resources.
- Counties with small per-capita sales-tax receipts but high property-tax burdens: the population-based distribution can under-serve counties with high property-tax need relative to their share of taxable sales, shifting local fiscal strain rather than fully resolving it.
Key Issues
The Core Tension
The central dilemma is between targeted property-tax relief for homeowners and the broader distributional effect of funding that relief through a consumption tax: the measure protects homeowners from property-tax burdens but shifts costs onto all consumers—including low-income families—while placing the formula in the constitution, which sacrifices future legislative flexibility to recalibrate that trade-off.
The amendment raises several implementation and equity questions. First, distributing proceeds by decennial census population will create temporal mismatches: rapidly growing counties will be allocated based on outdated population shares for up to a decade, producing allocation distortions until the next census.
Second, the dollar-for-dollar reduction requirement ties local property-tax capacity directly to a revenue stream whose size will fluctuate with consumption and economic cycles, potentially forcing service cuts or shifting other revenue sources in downturns.
Third, explicitly excluding this tax from statutory caps on local sales taxes and from food-and-beverage exemptions creates policy tension. Taxing food raises regressivity concerns and will draw immediate scrutiny, while removing the cap sets a precedent for constitutional exceptions that could complicate future local tax coordination.
Finally, the amendment leaves several operational details unspecified—timing of annual payments, reconciliation of under- or over-collections, measurement of the exact amount needed to 'fully offset' homestead taxes, and dispute-resolution paths between the state and counties—so the implementation will depend heavily on subsequent statute and administrative rulemaking.
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