Florida voters will decide in November 2026 whether to approve a constitutional amendment that would substantially reduce property taxes on homestead properties. The proposal is intended to address rising property tax bills, but the source argues that it could shift tax burdens, weaken local public finance, and make Florida’s tax structure less stable and competitive.
Why Florida Property Taxes Are Under Pressure
Property tax bills have risen across the United States because of several factors:
- Rapidly rising home values
- Local government spending increases
- Inflation
- Higher costs of providing local government services
Florida has experienced the same pressures. In recent years, Florida taxpayers have raised concerns about the affordability of homeownership.
Governor Ron DeSantis has supported the idea of amending the Florida Constitution to eliminate property taxes on homestead properties. The legislature did not pass such legislation during the 2026 regular session, so the governor called a special legislative session to pursue major changes to Florida’s property tax system.
The November 2026 Ballot Proposal
On June 2, 2026, the Florida Legislature passed HJR 1, a joint resolution proposing a constitutional amendment to reduce property taxes on homestead properties by increasing the homestead exemption.
The amendment, called the “Save our Homes from Excessive Property Taxes” proposal, will appear on the November 2026 ballot.
To pass, it must be approved by at least 60% of voters.
If approved, the amendment would make several major changes.
Larger Homestead Exemption
For all levies other than school district levies, the amendment would increase the amount of a homestead property’s value exempt from property tax.
The exemption would rise to:
- $150,000 in 2027
- $250,000 in 2028
Beginning in 2029, those amounts would be indexed for inflation.
The amendment would also require the legislature to create a procedure allowing local governments to continue increasing the amount of assessed value exempt from taxation, potentially up to the full value of the property.
Different Rules for New Florida Residents
The proposal would create Florida residency requirements for people moving to the state on or after January 1, 2027.
New Florida residents would receive a much lower homestead exemption of only $50,000 for non-school district levies during their first five years in the state.
After that period, they could qualify for the higher exemption.
Lower Assessment Cap for Non-Homestead Property
For all levies other than school district levies, the amendment would limit annual increases in the assessed value of all non-homestead property to 5% beginning in 2027.
The current cap is 10%.
Limits on Local Use of Property Taxes
The proposal would restrict local governments’ ability to use property taxes for services outside certain listed categories.
Permitted categories would include:
- Public safety
- Education and schools
- Infrastructure
- Natural resources
- Bond issuance and debt service payments
- Local government employee retirement benefits
- Operations and administration expenses related to certain local government employees
Property Taxes as Florida’s Local Revenue Base
Property taxes are the main source of local tax revenue in Florida.
As of fiscal year 2023, property taxes accounted for 74% of local tax collections in the state.
Homestead property is also a major part of Florida’s property tax base. It accounts for:
- 46.6% of the just value, or market value, of all real property in Florida
- 36.1% of the taxable value of all real property in Florida
Because homestead property makes up such a large share of the base, reducing or eliminating taxes on primary residences would significantly affect local government revenues.
Estimated Revenue Loss
Legislative fiscal analysis estimates that the proposed amendment could reduce local government revenues by:
- $4.6 billion in the first year
- $8.4 billion in the second year
The amendment does not include a plan to replace that revenue.
The source argues that reducing a large share of the property tax base would not reduce the cost of providing local services. Instead, the lost revenue would have to be made up elsewhere or local governments would have to reduce services.
Possible Shift to Other Property Owners
If counties and municipalities raise millage rates to recover lost revenue, taxes could increase on property that remains taxable.
This could affect:
- The taxable portion of homestead properties
- New Florida residents who receive only the lower exemption for five years
- Second homeowners
- Commercial properties
- Apartment complexes
- Industrial properties
- Agricultural properties
The source argues that this would make Florida’s property tax system less neutral and could discourage the purchase or ownership of certain types of property.
Possible Shift Toward Sales Taxes
Florida has no individual income tax, so state and local tax revenue depends heavily on property taxes and sales taxes.
If policymakers try to replace lost property tax revenue with sales tax revenue, they may need:
- Higher local sales tax rates
- Higher state sales tax rates
- A broader sales tax base
- Some combination of higher rates and broader taxation
Previous Tax Foundation research cited in the source estimated that eliminating all Florida property taxes and replacing the revenue with sales taxes would require an average combined state-local sales tax rate of 15.34%, before accounting for reduced consumption at higher rates.
Although HJR 1 would not eliminate all property taxes, the source argues that substantial sales tax increases would likely still be needed if policymakers want to avoid major spending cuts.
Current law caps local option sales tax rates at 1.5%, which means most jurisdictions could not recover the full revenue loss through local sales tax increases alone.
Cross-Border and County-to-County Shopping Effects
Large increases in local sales tax rates could change consumer behavior.
Residents in higher-tax counties could shift purchases to lower-tax neighboring counties.
Residents in northern Florida could also shop across state lines in Alabama or Georgia.
The source notes that average combined state and local sales tax rates are:
- 9.46% in Alabama
- 7.49% in Georgia
If Florida sales tax rates increased significantly, cross-border shopping could become more attractive.
Fees and State Aid as Alternatives
Local governments might also raise existing fees or create new fees to cover revenue gaps.
Another option would be for the state to increase aid to local governments, funded through a higher state sales tax rate, a broader state sales tax base, or both.
The source argues that this would create a state-for-local tax swap. That could weaken the relationship between local taxes paid and local services received.
It could also reduce local control over spending decisions if local governments become more dependent on state funding.
Risk of Incomplete Revenue Replacement
The source argues that available replacement options are unlikely to fully cover the lost property tax revenue.
If replacement revenue falls short, local tax authorities may face significant revenue reductions imposed by the state, even if local taxpayers would have preferred to maintain services through local property taxes.
This creates a tension between state-level constitutional tax limits and local-level public finance needs.
Why the Source Defends Property Taxes for Local Services
The source argues that property taxes are the best available revenue source for local government services.
The reasons given include:
- Property taxes are transparent because homeowners can see the annual amount owed.
- Property taxes are economically efficient compared with many alternatives.
- Property taxes align with local benefits received.
- Local services such as infrastructure, schools, and public safety help support property values.
- Property taxes connect local spending decisions to local taxpayers.
The source contrasts property taxes with sales taxes, which are less visible to taxpayers and can distort consumption decisions, especially when rates become very high or vary sharply across jurisdictions.
Alternative Approach Suggested by the Source
The source argues that Florida residents’ concerns about rising property taxes are valid, but that large exemptions or broad elimination of homestead property taxes are not the best solution.
It presents a well-structured property tax levy limit as a more sustainable approach.
A levy limit would restrict growth in property tax collections over time rather than carve out large parts of the tax base.
The source frames this as more structurally sound because it would address growth in tax burdens without shifting large costs onto other property owners or forcing greater reliance on sales taxes.
Main Policy Trade-Off
The proposal would reduce property tax burdens for many Florida homeowners with homestead properties.
But the source argues that the cost would be a major restructuring of local government finance.
The likely trade-offs include:
- Lower taxes on many primary residences
- Lower local government revenue
- Higher taxes on other property classes
- Possible higher sales taxes
- Possible broader sales tax base
- More local fees
- Less local fiscal control
- Greater tax distortion between homestead and non-homestead property
- Potential pressure on local services
Practical Ballot Question
The November 2026 vote is not only about whether Florida homeowners should receive property tax relief.
It is also about how local government services should be funded if a major share of the property tax base is reduced.
The source argues that substantially reducing or eliminating property taxes on most primary residences would not eliminate the need to fund schools, infrastructure, public safety, and local services. It would instead shift costs elsewhere.
The central issue is whether the benefits of lower homestead property taxes are worth the potential costs: a narrower property tax base, higher burdens on other taxpayers, heavier reliance on sales taxes or fees, and a less neutral tax structure.
Source article: taxfoundation.org
