Georgia State of the State 2026: Kemp proposes $1B tax rebate, new DREAMS scholarship

Gov. Brian Kemp delivered his final State of the State address Wednesday at the Georgia State Capitol, outlining budget proposals and priorities for his last year in office with a strong focus on tax relief, state employee pay, and long-term investments.

What we know:

Speaking before members of the Georgia General Assembly, Kemp highlighted what he called a strong state economy and pointed to nearly $9.7 billion already returned to Georgians through tax relief during his administration.

"There is no question the state of our state is stronger, more prosperous, and safer today than it was in January of 2019," Kemp said.

Tax relief and state pay

Local perspective:

The governor’s plan includes a fourth one-time, $1 billion tax rebate, which would provide $250 for individual filers and up to $500 for married couples filing jointly. He is also calling for further permanent cuts to the state’s personal and corporate income tax rates, stressing that his administration remains focused on "addressing hardworking Georgians’ concerns over the persistently high cost of living."

To support the state's workforce, Kemp proposed a one-time $2,000 pay supplement for all state employees, including educators and public safety officers. Despite the proposed spending—which also includes more than $2 billion for transportation projects—Kemp noted that Georgia’s rainy day fund would remain above $10 billion.

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Gov. Kemp announces a budget proposal for $250 tax rebate

During his State of the State address, Georgia governor Brian Kemp announced a proposal for a $250 tax rebate for individuals to alleviate increased costs of living. Listen to the moment from his speech.

A New Legacy in Education

What they're saying:

A major pillar of the governor’s amended budget is a $325 million investment to create the "DREAMS Scholarship," Georgia’s first need-based scholarship program.

"The DREAMS Scholarship will build on the incredible, unmatched legacy of the HOPE Scholarship and leave no stone unturned when it comes to student achievement in our state," Kemp said.

The proposal received a warm reception from some members of the opposition. Rep. Carolyn Hugley, D-Columbus, said the scholarship was long overdue. "The most exciting thing I heard was the dream program," Hugley said. "Because we've been asking for need based scholarships for years."

Addressing Homelessness and Healthcare

The other side:

Kemp’s agenda also features a $50 million investment to address homelessness and a continued focus on workforce development. However, Democrats noted that the governor’s priorities did not extend to healthcare reform.

Hugley expressed surprise that the speech did not address the expiration of ACA subsidies or the challenges facing the state’s medical coverage.

"We have been talking about expanding Medicaid year after year," Hugley said. "There are cuts to Medicaid coming down to us from the federal government. That's a real challenge. And I'm surprised that it was not mentioned."

As the legislative session begins, Kemp’s focus remains on utilizing the state’s surplus to provide immediate relief to taxpayers while securing his final policy wins before leaving office.

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