Gov. Braun says he will sign property tax bill if lawmakers approve specific amendment

INDIANAPOLIS— Indiana Gov. Mike Braun announced on Wednesday that he would sign SB 1 into law if a specific House amendment made it into the final version.

Braun had previously threatened to veto the bill or call a special session if lawmakers didn’t change the bill to better align with his original property tax relief plan. In a statement announcing the SB 1 agreement, he said:

“I am proud to announce that with Amendment 36 to Senate Bill 1, we have agreed upon a plan to bring historic property tax relief to Hoosiers. I am grateful for the leadership of Speaker Todd Huston and President Pro Tem Rod Bray and for the ways they have partnered with us to deliver this meaningful tax relief to Hoosiers. I encourage House members to support this amendment and urge the Senate to then take action quickly to get it to my desk for signature.”

According to House Republicans, Amendment 36 would increase the amount Hoosier homeowners could save over the next three years (up from $1.1 billion to at least $1.4 billion). For the average homeowner, that translates to savings of roughly $300 per year.

“About two-thirds of homeowners will see a reduction in ‘26 compared to ’25,” State Rep. Jeff Thompson (R-Lizton), the House Ways and Means Chairman, said. “Nearly all homeowners statewide will see a reduction in what would happen without the bill.”

According to Thompson, the amended bill reduces the total amount of local income taxes counties can capture by two billion dollars. However, the bill also allows larger cities to impose their own local income tax rate of up to 1.2 percent.

“85 counties are going to adopt large local income tax increases,” Michael Hicks, the Director of the Center for Business and Economic Research at Ball State University, said.

According to Hicks, fixed-income seniors, disabled veterans, and wealthier homeowners will benefit if this version of the bill passes. However, he anticipates the tax burden will shift towards younger, working households.

”The big losers in this are young families who are trying to both take advantage of good schools that are now being defunded and paying income taxes at a much higher rate than the retired families,” Hicks said.

In addition to concerns local governments could still be hard hit, House Democrats urged their Republican colleagues to pump the brakes on these changes—arguing that the updated bill contains too many variables that haven’t been studied.

“I just can’t continue to stomach and vote for something that has so many uncertainties,” State Rep. Gregory W. Porter (D-Indianapolis) said. “I just hope that we can continue to work on it. My spirit tells me this is probably it right now.”

The bill still has yet to pass a third reading in the House before making its way back to the Senate.