Five states are pushing bold plans to slash or completely eliminate property taxes for homeowners, using budget surpluses and alternative revenue sources in what could become the most dramatic shift in residential taxation in decades.
North Dakota, Georgia, Florida, Texas, and Indiana lawmakers have introduced proposals that would either drastically reduce or completely phase out property taxes for primary residences. The movement, largely driven by Republican-controlled legislatures, aims to address voter frustration with rising housing costs while states sit on healthy budget reserves.
“Some of these states, namely Texas, have high property tax rates that are unpopular among voters, especially when the state runs a budget surplus nearly every year,” Joel Berner, senior economist at Realtor.com, explained.
Oil Money Fuels North Dakota’s Ambitious Plan
North Dakota’s approach might be the most financially secure. Republican Governor Kelly Armstrong has proposed using $483 million from the state’s general fund and oil tax savings to begin a decade-long process of eliminating property taxes for most homeowners, starting with expanding the primary residence tax credit to $1,550 per household. The state’s massive $13.4-billion oil tax savings account provides substantial backing for the plan.
“It works, and we know we can build on it to provide even more relief and get property taxes to zero for the vast majority of North Dakota homeowners,” Armstrong stated, pointing to the program’s initial success that has already eliminated property taxes for 50,000 households at a cost of $400 million in subsidies.
But can other states replicate this model without North Dakota’s energy windfall? That’s where the approaches diverge significantly.
Florida’s Constitutional Push
Florida has taken a different tack, with lawmakers proposing 11 constitutional amendments for the 2026 ballot focused on eliminating or reducing non-school property taxes on homesteaded property. Two major proposals stand out: HJR 201, which calls for total elimination of non-school taxes, and HJR 203, which would phase them out over a 10-year period, according to legal experts who have analyzed the proposals.
Meanwhile, South Dakota voters will face an even more radical choice in 2026 — a constitutional amendment to abolish all property taxes statewide, replacing them with a new retail transaction tax that would essentially shift the tax burden from property owners to consumers. Critics worry this could make the state’s tax system more regressive, while supporters argue it would provide more stable funding for local governments than property values that fluctuate with the housing market, as documented in public hearings.
Broader Movement Gaining Steam
Ohio has already passed major property tax relief that will provide $2 billion in savings over three years starting in 2026, including an expanded owner-occupancy credit that will benefit millions of homeowners across the state, financial analysts have noted.
The timing of these initiatives isn’t coincidental. With many states sitting on substantial budget surpluses following years of economic growth and pandemic-era federal aid, lawmakers — particularly Republicans — see an opportunity to deliver on a perennial voter concern while potentially reshaping state tax structures for decades to come.
Property tax reform has become “a hot topic in 2026,” with many Republican-led states pushing for complete elimination to relieve homeowners, according to tax policy experts tracking the nationwide trend.
What remains unclear is how states would make up for lost revenue if property taxes disappear. Local governments rely heavily on property taxes to fund schools, police, firefighters, and other essential services. Without careful planning, the elimination of property taxes could force painful cuts or shift burdens to other taxes that might hit lower-income residents harder.
For now, though, the political momentum appears to be on the side of reform, with homeowners in several states potentially seeing their property tax bills shrink — or vanish entirely — in the coming years.
