We retired Tax Justice Blog in April 2017. For new content on issues related to tax justice, go to www.justtaxesblog.org
In recent years, Georgia has been a hotbed for regressive proposals to eliminate or lower the state’s
reliance on income taxes and replace that revenue with higher sales taxes. So far each of these proposals has been rejected, though late last year voters did cap the state’s top personal income tax rate—a change that could lead to financial problems down the road and may prevent future Georgians from making needed investments.
But hope springs eternal as there are indications that during the upcoming legislative session lawmakers are interested in tax reform yet again. While one of the most serious proposals on table is a familiar sort of regressive tax shift, the Georgia Budget and Policy Institute (GBPI) has released a new report explaining that the state has a variety of tax reform options at hand that would actually improve the fairness of the state’s tax code. In “A Tax Blueprint to Strengthen Georgia,” GBPI prescribes a tax plan that provides:
“a targeted tax cut to Georgians climbing the ladder toward the middle class, while protecting the state’s most critical investments. The plan consists of three core tenets: cut income taxes from the bottom up; modernize the sales tax to fit today’s online commerce and make special tax deductions less generous.”
An Institute on Taxation and Economic Policy (ITEP) analysis of the GBPI plan found that the overall fairness of Georgia’s tax structure would be improved under the proposal and the middle 20 percent of Georgians would see an average tax cut of $206. This blueprint for Georgia tax reform should be required reading for Georgia lawmakers. Once the debate heats up let’s hope they also heed the words of Wesley Tharpe from GBPI who opined in the Atlanta Journal Constitution, “One thing is for sure: A drastic shift from income to sales taxes is a flawed approach to reform. Georgia can do better.”