These States Have Cut Property Taxes, And More Are Trying To Do The Same

Homeowners in Montana and North Dakota are set to see a drop in their property taxes. And they may not be alone as the political movement to lower—or eliminate—state property taxes on primary residences gains steam.  

Property taxes have increased by 30% nationally since 2019, as home prices have skyrocketed since the pandemic, making it harder for some homeowners to afford where they live. To counter this trend, at least seven states have legislators or taxpayer groups pushing proposals to reduce property taxes for permanent residents.

Last year, Montana enacted legislation that would significantly lower taxes on homeowners’ primary residence for the 2025 tax year, while North Dakota also approved reforms to cut property taxes for 2025.

Now, voters in Florida could soon have the chance to reform property taxes after a proposal in the state’s legislature moved forward earlier this year. Similar plans are in the works in several other states.

Home prices have increased 55% nationwide since the pandemic. And since property taxes are determined by a home’s value, many American homeowners have seen a dramatic jump in their tax bills.

Reducing property taxes would make owning a home cheaper in those states, but the proposals are also stirring debate over whether local governments that rely on the revenue could be shortchanged in their budget process. Lower property taxes could also drive home values higher, which would be good for owners, but could make it even harder for first-time homebuyers to enter the market.

Here are the states where proposals to lower property taxes have been successful or are gaining momentum:

Montana

New property tax laws here will deliver a tax cut to 80% of residential property owners in the 2025 tax year—the average being $500—while another 10% of homeowners won’t see any tax increases, Gov. Greg Gianforte said.

Not only does the plan deliver a tax break for homestead properties, which are defined as an owner’s primary residence, it will also deliver a tax break for long-term renters in homestead properties. However, owners of vacation homes and other non-homestead properties will face a tax increase of 68% from 2024 to 2026, the state’s Department of Revenue estimated.

North Dakota

After Gov. Kelly Armstrong called for property tax relief in his 2025 State of the State address, the legislature followed through to expand the homestead property tax credit to $1,600 from $500. The revenue will be made up by the state’s Legacy Fund, which is capitalized through taxes on the state’s sizable oil production revenues.

“Homeowners will see a significant, immediate impact,” Armstrong said. “And it will put the bulk of primary residences on a path to zero [property taxes] within the next decade.”

Ohio

Late last year, Ohio passed legislation that would cap property tax increases at the rate of inflation. Still, some Ohio residents want further reductions, and a citizens’ movement to repeal property taxes is working to collect the 400,000 signatures needed by July to put it on the 2026 ballot.

Florida

Gov. Ron DeSantis threw his support behind eliminating the homestead property tax in the Sunshine State late last year.

Now, the legislature is debating a proposed ballot item that would increase the exemption for homestead properties by $100,000 a year over the course of the next 10 years, eventually eliminating homestead property taxes altogether. Property taxes that are used to pay for schools would remain in effect, however. The proposal will need the approval of 60% of voters. 

The initiative could pose a problem for Florida homebuyers, however—a Realtor.com study showed that eliminating the property tax there could drive home prices higher by up to 9%.

Pennsylvania

Since property taxes are often used to fund schools and other basic local services, some argue that property tax cuts should be accompanied by measures to replace the revenue.

But Pennsylvania Rep. Russ Diamond took a different approach in support of his legislation that would put the elimination of property taxes on that state’s ballots. Diamond argued that property taxes were a violation of personal liberty that should be repealed and his proposal would give the state legislature five years to figure out how to replace the funding. 

“That question is entirely secondary to the objective of securing our right to true liberty by eliminating real property taxes,” Diamond wrote in a blog post. “The rest is merely a math problem, which you can assign to your servants—the Pennsylvania General Assembly—to figure out.”

Kansas

A proposal in the Sunflower State would create a new fund designed to help pave the way for reductions in property taxes. The bill would repeal some state sales tax exemptions to create a source of revenue for the fund, which would then be used to lower or repeal property taxes once the fund becomes large enough. So far, the measure hasn’t moved forward in the Kansas legislature.

Illinois

Lawmakers in this state have introduced legislation that would exempt homeowners from property tax if they’ve lived in their house for 30 years or longer.

Other Reforms

Other states have also considered eliminating property taxes. The Missouri legislation didn’t advance a 2025 bill that would have put a plan to replace property taxes with sales taxes on the ballot. The Indiana and Oklahoma legislatures have also so far failed to move forward with property tax bills.