HAPPENINGS AT THE STATE CAPITOL

As General Assembly Approaches Midpoint, Key Banking Issues Surface

The Georgia General Assembly completed Day 18 of its 40-day session Thursday. Below is a report of the most significant legislative news from the Capitol. The Legislature will be off Monday for Presidents’ Day, then will be in session Tuesday through Friday next week. Crossover Day is set for Friday, March 6, and Sine Die is scheduled for Thursday, April 2.

More on the Risk to Georgia’s Bank Tax Credit

As we explained in Thursday’s GBA Bulletin, the biggest development this week was Senate passage of SB 476 by Blake Tillery (R-Vidalia). The bill would cut the Georgia income tax rate to 4.99% for individuals, corporations and pass-through entities beginning this year. It also increases the standard deduction to $100,000 for married joint filers and $50,000 for single filers, and sunsets all credits against taxable net income by Jan. 1, 2032, while repealing various industry-specific credits and exemptions. Because tax bills must originate in the House, the Senate also passed HB 134, by Rep. Beth Camp (R-Concord), stripping out language on manufactured housing and replacing it with identical language to SB 476.

Of particular concern for banks is the proposed repeal of the dollar-for-dollar state income tax credit for financial institutions (the “bank tax credit”), which could dramatically affect how banks are taxed. Georgia's banking industry is facing a significant legislative threat as SB 476 moves to the House. While most Georgia businesses are taxed only on their net income, banks are subject to a unique and complex tax structure. In addition to the standard state corporate income tax, banks pay a specialized "bank tax" consisting of three separate levies from the state, counties and cities. This “bank tax” is a combined 0.75% tax on gross receipts and allows for almost no deductions for common business expenses like salaries or supplies.

Sen. Blake Tillery

Rep. Beth Camp

The bank tax credit was established specifically to prevent banks from being the only industry in the state forced to pay two different taxes on the same dollar. This credit ensures that a bank pays the higher of the two tax liabilities, creating a floor that supports local community funding, without unfairly penalizing the institution. It is not a specialized incentive or a loophole; rather, it is a structural necessity that keeps the tax system functioning fairly.

If SB 476 passes in its current form and eliminates this credit, the impact would be immediate and severe. Georgia banks could see a combined $55 million annual increase in taxes owed to state and local governments. This would leave many institutions, particularly those with high operating expenses and tighter profit margins, facing a tax burden far higher than any other business sector in the state, as those companies are only subject to the corporate income tax which allows such expenses to reduce their tax burden. As the bill moves to the House, it is vital to emphasize that removing this credit doesn't eliminate a benefit, it introduces a double-taxation penalty. Click here to read our full whitepaper: The Necessity of the Georgia Income Tax Credit for Depository Financial Institutions.

Additional Income Tax Measures Receiving Action this Week

SB 477 by Sen. Blake Tillery (R-Vidalia) reduces the personal income tax rate from 5.19% to 4.99% in 2026, 4.49% in 2027, and 3.99% in 2028. It creates an automatic delay mechanism if revenue growth falls below 3% or reserve funds are insufficient. It also fixes the corporate tax rate at 4.99% starting in 2026. A House bill, HB 463 by Rep. Shaw Blackmon (R-Bonaire), was also amended and stripped to include the language in SB 477. Both bills passed the Senate.

HB 880 by Rep. Shaw Blackmon (R-Bonaire) reduces Georgia's income tax rate from 5.19% to 3.99% through gradual annual reductions beginning in 2026. It increases standard deductions, dependent deductions, and retirement income exclusions for taxpayers over age 65 while expanding the Revenue Shortfall Reserve cap. The bill was favorably reported by the House Ways & Means Committee.

HB 1001 by Rep. Will Wade (R-Dawsonville) sets Georgia's individual income tax rate at 4.99% starting Jan. 1, 2026, instead of the previously scheduled 5.19% rate. It establishes specific revenue conditions that must be met to prevent delays in implementing the tax rate reduction. The bill was favorably reported by the House Ways & Means Committee.

Rep. Shaw Blackmon

Rep. Will Wade

New Interchange Bill Introduced in Senate

We were disappointed this week to see the introduction of another bill prohibiting the collection of interchange on the sales tax portion of card transactions. SB 512 by Sen. Drew Echols (R-Gainesville) will receive its committee assignment Tuesday. The bill is Identical to HB 431 by Rep. Todd Jones (R-South Forsyth) introduced in 2025, which is still awaiting a hearing in the House Banks & Banking Committee. A similar measure introduced in 2023 was withdrawn at the start of the 2024 session after significant pushback from banking and payments stakeholders.

We will continue reminding lawmakers these bills are bad public policy and would amount to the legislature intervening in a pricing dispute between private industries. Research consistently shows such policies only benefit large national retailers. Disrupting the global payments system to subsidize big-box retailers for tax remittance ultimately costs small businesses and customers.

We will also point out that HB 439 by Rep. Bill Yearta (R-Sylvester) has already passed the House and now awaits further consideration in the Senate Finance Committee. The bill, which was the recommended by the 2024 House Special Study Committee on Interchange, would increase vendor compensation from the state for collecting and remitting sales tax. Passage of HB 439 would be a far better way to compensate retailers for to cost of collecting and remitting sales tax for the state.

Sen. Drew Echols

Rep. Todd Jones

Rep. Bill Yearta

Updates on Legislation GBA is Tracking

Be sure and set a web browser bookmark for the State Issues page on the GBA website to track details about specific bills during the session. Clicking a bill number link gives you the text of the bill and its current status as it moves through the process. GBA is tracking many bills on the State Issues page that will be reported on during the session if action is taken on them and they are relevant to the banking industry. This week, we want to note the following:

Earned Wage Access

SB 282 by Sen. Russ Goodman (R-Cogdell) would regulate earned wage access services in Georgia by setting rules for providers, banning certain practices and clarifying that these services are not loans or money transfers. The bill was recommitted from the Senate Insurance and Labor Committee to the Senate Agriculture and Consumer Affairs Committee.

Frivolous Liens

HB 676 by Rep. Rob Clifton (R-Evans) establishes a $1,500 fine for each frivolous mechanic lien filed without substantial justification or in bad faith. It adds financial penalties in addition to existing attorney fees and court costs. The bill passed the House and has been assigned to the Senate Judiciary Committee.

Foreclosure Notification

HB 948 by Rep. Beth Camp (R-Concord) requires foreclosure notices clearly disclose debtors’ rights to surplus funds following a foreclosure sale and requires deadlines for claiming excess funds to be prominently displayed in bold type and accompanied by the necessary claim forms. It would also extend these notice requirements to tax sale proceedings. The bill passed the House.

Timber Tax

HR 1000 by Rep. Chuck Efstration (R-Mulberry) proposes a constitutional amendment to eliminate ad valorem tax assessment on timber harvested from certain qualifying properties. It requires the state to annually appropriate 100 percent of lost tax revenue to affected counties, municipalities, and school districts. The resolution was favorably reported by the House Ways and Means Committee.

Bankruptcy Exemption

HB 1024 by Rep. Soo Hong (R-Lawrenceville) increases the homestead exemption from $21,500 to $50,000 for individual debtors in bankruptcy and insolvent estate proceedings. It raises the exemption from $43,000 to $100,000 when property is the primary residence of both spouses. The bill was favorably reported by the House Judiciary Committee and then recommitted back to its committee of origin by the House Rules Committee.

Title Sales

HB 1042 by Rep. Matt Reeves (R-Duluth) allows credit bids in judicial sales and establishes enhanced privacy protections for judges' personally identifiable information. It requires government entities to restrict judges' personal data from public records and establishes qualification requirements for special masters in quiet title actions. The bill was favorably reported by the House Judiciary Committee.

Georgia Housing and Finance Authority

HB 1180 by Rep. Clint Crowe (R-Jackson) eliminates outstanding bond limits for the Georgia Housing and Finance Authority's single-family residential housing program and other financing programs. It requires all authority bonds to include a statement clarifying they do not constitute state debt or pledge state backing. The bill was favorably reported by the House Governmental Affairs Committee.

Development Impact Fees

HB 1233 by Rep. Kasey Carpenter (R-Dalton) authorizes local governments to waive development impact fees for workforce housing projects without requiring alternative funding sources. It prohibits municipalities and counties from increasing impact fees on other projects to offset revenue lost from workforce housing exemptions. The bill has been assigned to the House Governmental Affairs Committee.

State Agencies

HB 1247 by Rep. Matt Reeves (R-Duluth) prohibits courts and administrative officers from deferring to state agency interpretations of laws and regulations. It requires independent judicial interpretation of constitutional provisions, statutes, regulations, and subregulatory documents. The bill has been assigned to the House Governmental Affairs Committee.

Georgia Code Revision

HB 1268 by Rep. James Burchett (R-Waycross) is the Georgia Code Revision Commission's annual bill recommending non-substantive changes to the Georgia Code. There are several changes to Title 7, which deals with banking and finance. The bill has been assigned to the House Code Revision Committee.

Stablecoin

HB 1272 by Rep. Todd Jones (R-South Forsyth) creates a comprehensive regulatory framework for payment stablecoin issuers in Georgia, requiring state licensing and compliance with federal GENIUS Act standards. It establishes reserve requirements, examination procedures and enforcement mechanisms while prohibiting unlicensed stablecoin issuance and the payment of interest. The bill has been assigned to the House Banks & Banking Committee.

Transactional Gold and Silver

HB 1306 by Rep. Todd Jones (R-South Forsyth) requires the state to recognize gold and silver as legal tender for voluntary transactions by Jan. 1, 2028. It creates a six-member Bullion Depository Commission to establish secure storage facilities. It also authorizes electronic payment systems to facilitate transactions, establishes full nongovernmental deposit insurance coverage and privacy protections for depositor accounts and prohibits taxation on gold and silver transactions. The bill is awaiting committee assignment.

Credit Reporting

HB 1314 by Rep. Marvin Lim (D-Norcross) requires installment lenders to inform borrowers whether their loan will be reported to credit agencies. It would take effect July 1, 2026, for all new loan agreements entered into after that date. The bill is awaiting its committee assignment.

GBA Represented at the Capitol

The association’s advocacy team is hard at work representing the interests of banking at the State Capitol. Reach out to any of them if you need information about a bill, contact information for your representatives or tips on where to park if you’re coming for a visit. Here’s their contact information:

• Elizabeth Chandler, executive vice president, government relations and advocacy: echandler@gabankers.com, 404.372.7893
• Bo Brannen, senior vice president, member services and advocacy: bbrannen@gabankers.com, 404.731.9886
• Steve Bridges, government relations consultant: sbridges@gabankers.com, 770.789.5605
• Tripp Cofield, president and CEO: tcofield@gabankers.com, 617.909.9530.

We will publish future editions of the Legislative Update after the General Assembly adjourns each week. Please let us know if you have questions or comments on issues of interest to you.