Providence moves to end the homestead exemption. Here's what it means for property owners.

Providence is moving toward eliminating the homestead exemption for taxpayers.

On Tuesday, Mayor Brett Smiley's bill passed the House after earlier clearing the Senate and is now on its way to Gov. Dan McKee's desk to be signed into law.

But what does that mean for your next tax bill? Not much, actually.

Why it matters:

With McKee's signature, the homestead exemption, a tax reduction for homeowners, will be gone. But as an alternative, Smiley plans to create two categories for the residential tax.

Per the mayor's fiscal year 2025 budget proposal:

• Owner-occupied properties would be taxed at $10.46 per $1,000 of valuation
• Non-owner occupied properties would be taxed at $18.35 per $1,000 of valuation

More: Taxes, schools and police: Here's what's in Smiley's Providence budget proposal for 2025

The mayor's administration has said it hopes the switch will draw more attention to Providence's tax rate, perhaps pulling in new residents.

Go deeper: Move comes after Smiley hiked taxes last year

The mayor's office has repeatedly said Providence has the eighth-lowest tax rate in the state, but that is only if the homestead exemption is factored in. West Greenwich, Foster and East Greenwich have among the highest residential tax rates but lower homestead exemptions than Providence.

Smiley's budget wouldn't increase taxes in the coming year. Last year, Smiley was responsible for the first tax hike Providence had seen in a decade . That year, the City Council passed a 2% decrease in the homestead exemption, placing it at 43%, and approved boosting the residential rate from $17.80 per $1,000 to $18.35 per $1,000.

This article originally appeared on The Providence Journal: Providence moves to end the homestead exemption. Here's what it means for property owners.