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Baldwin: Senate Republicans roll out plan to provide $1.4 billion in property tax relief

FOR IMMEDIATE RELEASE

Contact: Abbey Webb, Press Secretary
Abbey.Webb@iga.in.gov
317-234-3560

Baldwin: Senate Republicans roll out plan to provide $1.4 billion in property tax relief

STATEHOUSE (Feb. 18, 2025) — This week, Senate Republicans' top priority bill on property tax relief passed the Senate, said State Sen. Scott Baldwin (R-Noblesville).

Baldwin, who is third author on Senate Bill 1, said that Senate Republicans seek to balance the real needs of relief for homeowners with the budget realities of local governments. As it passed the Senate, SB 1 includes historic growth-control measures to limit property tax growth for all Hoosiers, including reforms to the referendum process, along with specific property tax relief for homeowners and farmers. Most significantly, SB 1 would freeze local operating fund levies in 2026. All told, this package is projected to save Hoosier taxpayers $1.4 billion on their property tax bills over the next three years.

"The Senate Republican plan offers all property taxpayers unprecedented relief," Baldwin said. "In addition, we offer targeted relief to property owners who may need it most like senior citizens, disabled veterans and farmers. I sat down with Gov. Braun and his team on multiple occasions to discuss this bill, and I believe our caucus is offering a balanced approach that will benefit our taxpayers."

Provisions in the Senate Republican Property Tax Cut Plan

Limitations on property tax growth for all Hoosiers

  • SB 1 freezes local property tax operating fund levies for property taxes paid in calendar year 2026, then imposes a 1% growth cap in 2027 and a 2% growth cap in 2028.
  • Starting in 2029, SB 1 implements a new levy growth formula intended to limit big year-to-year swings in levy growth.
  • SB 1 limits local governments' ability to go above the annual maximum operating levy growth cap. Instead, local officials will have to pursue a referendum, so voters can decide whether to approve extra levy growth.
  • SB 1 ends automatic levy growth by forcing local governments to have a separate public meeting and have a stand-alone vote on annual levy increases.

Relief for homeowners

  • SB 1 creates a new $2,500 property tax credit for first-time homebuyers, with a home value cap of $250,000 and an income cap of $75,000.
  • SB 1 expands eligibility for the existing disabled veteran property tax deduction, senior citizen property tax deduction and senior citizen property tax circuit breaker credit. It also increases the value of these deductions to $20,000.
  • SB 1 gives counties the option to let homeowners annually defer up to $500 of their property tax bill until their home is sold.

Relief for farmers

  • SB 1 reforms the agricultural land assessment formula to cut property taxes for farmers.

Reforms to the referendum process

  • SB 1 institutes a one-year "cooling off" period for capital project referendums, so taxpayers can see one year of savings on their property tax bills before deciding whether to approve a new referendum.
  • · SB 1 requires all referendums to occur during November general elections when turnout is highest.

"Property taxes are dependent on a wide array of factors, and this new approach provides tax relief for all areas of Indiana," Baldwin said. "Critical services local governments provide come from property taxes. Unlike the original plan, which could have significantly strained cities, towns and local municipalities, our approach provides tax relief while ensuring essential local services – such as police, firefighters, and schools – remain well-supported and functional. It took us several years to get these property tax levels, and the new control measures will cause local governments to tighten their belts and allow expense growth to catch up with the previous tax increases."

The State and Local Tax Review Task Force (SALTR) and its subgroups have been studying local and surrounding tax plans looking for solutions to the rising costs of property taxes for two years.

"We ran our plan through hypothetical situations extending several years to into the future to see what results it would yield," Baldwin said. "We even applied the plan to what life was like in 2021 to see if it would work. This new proposed legislation is a sincere way to address Hoosiers' concerns. I believe this approach will support long-term stability."

The Indiana General Assembly reconvened for the 2025 legislative session Jan. 8 and must conclude by April 29. Visit iga.in.gov to view livestreams and archive videos of session and committee meetings, view legislative calendars, review legislation and more. To read more about the Senate Republican agenda, visit IndianaSenateRepublicans.com/2025Agenda.

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State Sen. Scott Baldwin (R-Noblesville) represents Senate District 20,
which includes Noblesville, Carmel, Cicero and unincorporated areas of Hamilton County.
Click here to download a high-resolution photo