Tax Policy / Tax Reform in Georgia

The Ways and Means Committee is the chief tax writing committee in the General Assembly and derives its’ importance from the state Constitution that provides all revenue bills must originate in the House. The committee considers not only taxes (income, sales, ad valorem, excise, motor fuel, estate, and others), but exemptions and credits as well. I currently serve as Secretary to the full Committee and Chair of the Ad Valorem Tax Subcommittee.

Representative Jay Powell is Chairman of the Ways and Means Committee and he has charged members with considering appropriate tax policy to apply to tax reform efforts in Georgia. I shared with Chairman Powell the following thoughts on the direction I would like to see tax policy and tax reform move in Georgia.:

  • No rate increase on any non-excise tax revenue source
    • No increase in the sales tax rate
  • Reduce personal income tax rates
  • Eliminate corporate income taxes
  • No tax on business inputs
  • Broaden the sales tax base
    • Provides opportunities for increased revenue at current rates
  • Reduce the number of income tax brackets
  • Adjust ‘sin’ taxes to the average of all states or the average of border states
    • Would result in a reduction in some tax rates and an increase in others ultimately resulting in a neutral tax policy for Georgia as compared to other states with regard to ‘sin’ taxes.
  • No fees on property tax bills
    • Generates an estimated $6 – $8 million in revenue to the state and acts as a ‘governor’ on local governments raising taxes and fees.
  • No new local sales taxes and/or increases in existing caps
  • Eliminate certain credits / exemptions – based on return on investment analysis; will result in revenue
  • Sunset all credits / exemptions – likely will result in revenue over time
  • New credits by refund ONLY once documented achieving goals – likely to result in revenue over time
  • Policy should benefit maximum number of taxpayers possible
  • Policy does NOT incentivize government assistance
  • Policy does NOT drive market behavior and/or create new private sector profit opportunities
    • i.e.: marketable tax credits
  • Recognize our bond rating is the result of sound fiscal policy and should not dictate policy
Obviously, there are many more considerations and the devil is in the details of any piece of legislation, however, these are the broad concepts I believe would serve Georgians well with regard to our tax policy and tax reform.