Gatlinburg Property Tax Rate Drops to 6.91¢ After Reappraisal — $136.4M Budget Approved on First Reading

The Gatlinburg City Commission approved first reading of the fiscal year 2026-27 budget totaling $136.4 million on Tuesday, July 21, along with a certified property tax rate of 6.91 cents per $100 of assessed valuation — down from 12.57 cents in the prior year.

Why did Gatlinburg's property tax rate drop nearly in half?

This was a reappraisal year in Sevier County, and assessed property values rose significantly across the city. Tennessee law requires municipalities to adopt a certified tax rate — the rate that generates roughly the same revenue as the prior year — so that rising assessments do not automatically produce a windfall for the city. Gatlinburg Finance Director Robert Holt explained: "We have to decrease the rate to achieve about the same amount of revenue as we have in previous years so we can basically say we do not have a tax increase."

What does the $136.4 million budget include?

The proposed budget covers all city funds and continues Gatlinburg's practice of operating within its means while investing in employees, public safety, infrastructure, and equipment. Among the highlights discussed at a July 20 budget workshop: a 4% cost-of-living raise for city employees, plus 5% pay adjustments to starting rates for police and fire personnel.

What is the timeline for final approval?

Second reading with a public hearing is scheduled for 5 p.m. Tuesday, August 4. Final reading is tentatively set for 5 p.m. Tuesday, August 18. Property owners who want to comment on the rate should attend the August 4 session.

How do Gatlinburg property taxes compare?

The effective rate stays roughly the same because the lower millage is applied to higher assessed values. Homeowners should see a similar tax bill — not a reduction — unless their individual property appreciated at a different rate than the county-wide average.

What does this mean if you own or buy in Gatlinburg?

• Current owners: your millage rate is lower but your assessed value is higher. Net tax bills should be roughly flat. If your assessment jumped more than the average, you have until the county-posted deadline to file an appeal with the Sevier County Property Assessor.
• Cabin investors: the reappraisal reflects what the market already knows — short-term rental properties in Gatlinburg have appreciated meaningfully. Factor the new assessed value into your cash-flow projections.
• Buyers: the certified rate applies to the new assessment. When estimating your monthly payment, use 6.91 cents times the assessed value (25% of appraised value for residential), plus the county rate.
• Sellers considering listing: the reappraisal confirms values have risen, but Sevier County resale homes are currently closing at about 91% of original list price. The assessed value is not the price a buyer will pay — it is the starting point for a negotiation that requires accurate comps and correct pricing.

Sources: Gatlinburg City Commission, July 21, 2026, first reading (The Mountain Press, July 22, 2026); Gatlinburg budget workshop, July 20, 2026 (The Mountain Press, July 20); Sevier County Property Assessor certified rate notification.

*Tracy and seller must agree on price and possession date