Senate Republicans passed a proposal Thursday to reduce the state’s income tax while cutting some of the state’s tax credits for corporations despite Democratic pushback in a hours-long debate.
Vidalia Republican Sen. Blake Tillery, who is running for lieutenant governor and who is sponsoring the proposal, said that the legislation is “tailored to address the affordability crisis for the middle class” by putting “people over corporations.”
“People outside this building and inside it now too, said that affordability is the word of the session. You’ve heard that from the House. You’ve heard that from the majority caucus. You’ve heard it from the minority caucus … and as a government, we now sit here and hear people literally screaming for leadership to address the needs they need most, and that’s affordability,” Tillery said.
Senate Republicans entered the 2026 legislative session with calls to eliminate the state’s income tax. Instead, Senate Bill 476 follows Gov. Brian Kemp’s recommended accelerated reduction in the state’s income tax to 4.99%, but it would also waive income taxes for all Georgians on up to $50,000 a year for individuals and $100,000 for married couples, which Tillery said would completely eliminate income taxes for roughly two-thirds of Georgians.
The proposed legislation would also cut a number of corporate tax credits, such as a costly credit given to data centers in Georgia, tax credits given to insurance companies and banks, a tobacco export tax credit, a number of credits adopted during the COVID-19 pandemic aimed at increasing available personal protective equipment and ventilators, as well as a tax credit for selling yacht parts. The bill would also require that income tax credits without a sunset date be reevaluated and reauthorized by lawmakers.
The bill passed 32-18 nearly along party lines, with Sen. David Lucas, a Macon Democrat, voting with Republicans. The Senate also passed Senate Bill 477, also sponsored by Tillery, which would reduce the state income tax yearly to 3.99% by 2028. It does not cut some corporate tax incentives like the other proposal does, and it only exempts up to $16,000 a year for individuals and $32,000 for married couples in income tax.
Democrats, who spoke at length Thursday, said the proposal would destabilize the state’s budget and would require lawmakers to eventually address a deficit they said it would create. Sen. Elena Parent, a Democrat from Atlanta, said that the Senate Republicans’ proposal is “complete magical thinking” that will inevitably lead to the state raising its sales tax.
“For the families that are struggling to pay rent, child care, utility bills, buy their groceries, it’s worse than a slap in the face. It is a flat-out scam,” Parent said. “You cannot blow a hole in our state budget bigger than a sinkhole swallowing Stone Mountain and pretend that the money doesn’t have to come from somewhere.”
Danny Kanso with the Georgia Budget and Policy Institute, a left-leaning nonprofit think tank, also characterized the proposal as a “massive hole,” saying on social media that the two bills together would cost the state about $9.5 billion yearly. The elimination of the corporate tax credits would offset that by about $3 billion, creating a $6.5 billion deficit.
‘That deficit is more than the state share of Medicaid spending to cover 2 million Georgians. It’s more than the state spends combined on its University and Technical College System. Simply put, this legislation would cause a massive hole in Georgia’s budget.’
Danny Kanso, Georgia Budget and Policy Institute
“That deficit is more than the state share of Medicaid spending to cover 2 million Georgians. It’s more than the state spends combined on its University and Technical College System. Simply put, this legislation would cause a massive hole in Georgia’s budget,” he said.
The actual price tag of the proposed income tax cuts is unknown as a fiscal note, a document estimating the legislation’s financial impact, has not been provided.
Republicans took turns speaking in support of the legislation Thursday, saying the income tax cut helps families who need it most by eliminating the income tax for most Georgians and funding it through taxes on corporations. They also said that the bill is necessary for Georgia to compete with neighboring states that have lower income taxes or none at all.
“We’re raising the standard deduction to ensure that 64% of Georgians won’t pay any income tax at all. There’s a reason, y’all, why the Republican Party is becoming the party of the working class. It’s because we recognize that we have to shrink the size of government and get more money back into the hands of everyday Georgians,” said Sen. Greg Dolezal, a Cumming Republican who is also running for lieutenant governor.
Sen. John Albers, a Roswell Republican, said the proposal is “as middle-class tax cut as it possibly could get,” saying that the savings people in his district would see would be significant.
“This is a true kitchen table issue where that’s the difference of paying my property taxes, being able to afford groceries, being able to take a family vacation, support your kids in sports, being on a fixed income as a senior citizen. If you can’t connect the dots on this one, it is time to go back to school and redo math class,” Albers said.
The Senate also passed House Bills 134 and 463, although Tillery replaced the original language in both bills to reflect Senate Bills 476 and 477, respectively. Legislation that creates revenue traditionally starts in the House, and although Tillery argued that a House version wouldn’t be necessary because his bills cut revenue, the Senate would pass identical House versions as an “olive branch.”
“We don’t want to have that debate at all. We wanted to send them an olive branch early and say, we’re wanting to work with you,” Tillery said.
The bill now heads to the House, where lawmakers have proposed their own solutions designed to give Georgians some financial relief. The 2026 legislative session ends April 2.
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