Push for tax reform likely to resurface in Ga. | savannahnow.com

15
Jul

Push for tax reform likely to resurface in Ga. | savannahnow.com

After a broad proposal to overhaul Georgia’s tax code failed a few years ago, state lawmakers returned the next year with a far narrower agenda and eliminated a handful of tax obligations, including the unpopular “birthday tax” on cars and trucks.

At the time, there was a promise that more reform was coming. Now, after a legislative session largely devoid of a broad discussion on taxes, there are signs that conservative groups plan to push for more action next year. In an election year, tax reform is likely to become an issue both at the state Capitol and on the campaign trail.

“There definitely is a need for tax reform,” said Virginia Galloway, director of the Americans for Prosperity Foundation-Georgia, a conservative group favoring a reduction in taxes, spending and regulations. “Georgia is not in bad shape right now compared to other states, but other states are continuing to reform their taxes so if we stand still, we actually go backward.”

Those supporting reform say Georgia must become more tax competitive to lure businesses to the state. They note states such as Florida and Tennessee that don’t tax personal income. Although lowering taxes or eliminating the income tax altogether remains popular among the state’s Republican leaders, the reality of governing has prompted a measure of caution.

House Speaker David Ralston said he was unsure how much of a priority tax reform would be in next year’s legislative session.

“There is a lot of interest out there in looking at the income tax and going to either a phased down or toward an elimination of that,” said Ralston, R-Blue Ridge. “I don’t think that’s something that is going to happen tomorrow or next week or overnight, but I think it is something that does merit us having some discussion.”

Asked if he would support eliminating the state income tax, Ralston said lawmakers should be “very, very careful” in the current economic climate.

“You have to keep in mind we’re still in a very sensitive budget period here in the state,” he added.

With state revenues improving, a set of bills active in the state Senate could provide an opening for debate.

One, sponsored by Senate President Pro Tem David Shafer, R-Duluth, would place a constitutional amendment before voters to ban any increase of the state income tax, currently at 6 percent. A second, also sponsored by Shafer, would ask voters to prohibit state lawmakers from increasing the state or local sales tax unless a referendum is passed on infrastructure projects or lawmakers authorizing an increase do so in conjunction with a decrease in the state income tax rate.

Gov. Nathan Deal has said there’s no need to worry about increases while he’s in office.

“The best cap on the state income tax is the veto pen that I hold, and it’s got a cap on it,” Deal said. “And it’s going to be a cap on raising any income tax in our state.”

via Push for tax reform likely to resurface in Ga. | savannahnow.com.

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