Opinion: The good and bad tax bills under the Gold Dome

The 14-year wait may finally be nearing an end.

Ever since Republicans took control of the governor’s mansion and state Senate in 2003 — the House took them two years longer — they have been talking about cutting and flattening Georgia’s income-tax rate. Despite multiple campaign promises and the recommendations of a special tax-reform commission, the closest they’ve come is passing a constitutional amendment to keep the top rate from rising above the current 6 percent.

House Ways & Means Chairman Jay Powell, R-Camilla. (AJC Photo / Bob Andres)

House Ways & Means Chairman Jay Powell, R-Camilla. (AJC Photo / Bob Andres)

But this past week the House approved a measure to set a single, flat rate of 5.4 percent. To offset the elimination of the lower five brackets, lawmakers added a tax credit for working families. (I expect senators to tweak that element to level things out for low-income Georgians without children.)

The net effect on revenues should be minimal: a savings to taxpayers of about $18 million a year, or about one-sixth of 1 percent of next year’s income-tax revenues, according to state forecasts.

That won’t satisfy Republicans’ appetites for tax cuts. But there are two considerations here.

First is that Gov. Nathan Deal has made it clear he won’t sign a bill with a significant cut to income-tax revenues, citing the need to maintain Georgia’s AAA credit rating and to continue adding to the state’s reserves. Other states have managed to implement well-designed tax cuts without hurting their credit — North Carolina is a pertinent example — but that argument will have to wait for Deal’s successor.

The second consideration is this bill, authored by Ways and Means Chairman Jay Powell, R-Camilla, makes important structural changes that stand on their own while also laying the groundwork for future rate reductions. Lowering the top tax rate by 10 percent would make Georgia more competitive with our neighbors and improve incentives to work and invest in our state. Flattening the brackets takes out needless complexity in the tax code. Another good provision in the bill indexes the standard and dependent deductions for inflation.

It’s a good thing this bill is moving along, because otherwise it hasn’t been a stellar legislative session for tax policy.

House members have passed a bill to tax more online sales and, late Friday, added a tax hike on used-car sales. Earlier Friday they defeated a tax on ride-hailing services such as Uber and Lyft, before taking the bill up again and passing it.

On the flip side, they have considered proposals that may not be terrible tax policy, but sure look bad. They passed a sales-tax exemption for repairs of yachts and other big boats, and were still weighing a tax break on jet-fuel purchases by commercial airlines. The latter bill would help Delta Air Lines, which gained and lost a similar tax break in recent years, generating strong feelings on both sides of the issue.

On an individual basis, it’s possible for someone (not me) to defend each of these smaller tax bills as a way to attract businesses or grow the economy. Absent more sweeping tax reform, some people just sigh and accept it as better than nothing.

That attitude is ultimately self-defeating. More sweeping tax reform has proved elusive in large part because, cumulatively, these smaller bills create more constituencies for a complex tax code.

The flat-tax bill is a step in the right direction. It’s too bad the other bills would make further progress all the more difficult.

Reader Comments 0

89 comments
breckenridge
breckenridge

March 6 - Pennsylvania Republican state Rep. Rick Saccone held a rally in Harrisburg earlier this week where he announced that he intends to run for the U.S. Senate against Democratic Sen. Bob Casey Jr. next year. Religious Right pseudo-historian David Barton and Sam Rohrer of the American Pastors Network joined Saccone at his rally, and yesterday Saccone appeared on Rohrer’s “Stand In The Gap” radio program where he explained that he is launching this bid for higher office because God wants Christians “who will rule with the fear of God in them to rule over us.”

I daresay the great James Madison would be sorely tempted to kick Saccone right square in the sacc. 

AndyManUSA#45
AndyManUSA#45

Dear America: Do you agree that your every phone conversation, your every email, your every private discussion should be reviewed by the government of the United States?


If you do agree, vote democrat, because that is what they believe.

breckenridge
breckenridge

If you actually believe Trump's unsubstantiated claim about Trump Towers being tapped by Obama - just the latest in the long line of such foolishness - then  you are a stupid loser.

Doom a classical liberal
Doom a classical liberal

Today Hedley was all upset and obsessing over Trump's hair. I wonder what he'll obsess over tomorrow- Trump's tie? His shoes perhaps?  

Doom a classical liberal
Doom a classical liberal

@Resist Trump @Doom a classical liberal


He's lacking class when it comes to how he treats women as sexual objects- just like Bill Clinton. Curiously, that never seemed to bother progs when it came to Clinton. Hypocrisy much? 


Clueless? You don't get too be a billionaire by being clueless. If that were the case then there's at least  one clueless clown is vastly more successful than yourself. 


Trump is very thin skinned. That's part of the problem. But then Obama was notoriously think skinned as well. And of course that didn't seem to bother you guys either.  

AndyManUSA#45
AndyManUSA#45

Flynn's phone conversation was tapped at Trump Tower. The FBI confirmed that the Russians attempted but were unable to penetrate RNC security. That only leaves one other possible source for the surveillance.


This is a major deal.

Doom a classical liberal
Doom a classical liberal

@AndyManUSA#45


Which is a major deal?- That Flynn's conversation was tapped at Trump towers? Or that RNC security was unable to be penetrated while the incompetents on the Dem side like John Podesta were compromised?

SGTGrit
SGTGrit

Hang tough conservatives and do not take anything for granted. The left is up against the wall and will fight back with anything legal or illegal. Be prepared and ready to counter as needed.

Visual_Cortex
Visual_Cortex

I'm a little disappointed that none of you Flat Earth Taxers didn't offer the argument that it's less commmplicated.

That one's always a hoot.

SGTGrit
SGTGrit

If you really want to debate true racism all you need to do is ask what has the Democrat party done for minorities other than use them as voting blocks and assume their vote. That assumption backfired in this most recent national election and it will be all down hill from here.

Doom a classical liberal
Doom a classical liberal

You know Trump derangement Syndrome is alive and well when they are obsessing over Trump's hair on a windy day. LOL!

Hedley_Lammar
Hedley_Lammar

@Doom a classical liberal The guy is a clown what can I say.


It must take hours in the morning to apply the fake tan and do the comb over.


But yeah. He is just a simple man of the people.



Doom a classical liberal
Doom a classical liberal

One thing I've noticed that's kinda interesting. So the state senate didn't become run by the Rs until 2003 and the Rs took the House 2 years later in 2005. Reminds me of the silly debate point that Dems are always making that all of the racist white Dems back in the 60s immediately migrated over to the R party.  Which makes me wonder. If that were true then how was it that the Dems were still running the state house and senate before 2003?


The Real Doom

Doom a classical liberal
Doom a classical liberal

@Starik @Doom a classical liberal


LOL! I appreciate the humor about Georgians but it sounds like you're proving my point. I don't deny that white Georgians have gradually moved to the R party over time. But the way the Dems present it repeatedly is that all the racist southern Dems who voted against the civil rights movement of 1965 immediately moved to the R party. And that is simply not true. Nearly all of the big heavyweight Dem names- people like Al Gore Sr, Bill Clinton's mentor William Fullbright, George Wallace, and on and on. All these guys stayed Dems to the ends of their careers. And those 3 I mentioned above were segregationists. Gore Sr. and Fullbright even voted against an antilynching law in 1958. 

Hedley_Lammar
Hedley_Lammar

@Doom a classical liberal @Starik But the way the Dems present it repeatedly is that all the racist southern Dems who voted against the civil rights movement of 1965 immediately moved to the R party.


They dint do that at first. First they became dixiecrats.


Today they are all Republicans 


The fact remains. Southern conservatives fought hard against civil rights. In the 60's most of them were Democrats. Today most Southern Conservatives are Republicans 

Doom a classical liberal
Doom a classical liberal

@Hedley_Lammar @Doom a classical liberal @Starik


Nice spin there, Hedley. You change it from Southern "Democrats" to southern "conservatives" to alleviate the Dem party of responsibility. Too funny!


And as a matter of historical fact more Republicans voted for the landmark civil rights bill than Democrats. Facts are pesky things. 

Starik
Starik

@Hedley_Lammar @Doom a classical liberal @Starik The Dixiecrats date back to the 1950s, when Strom Thurmond ran for President. Lots of Georgia Democrats in the General Assembly switched to the Republicans about when Zell Miller, nominally a Democrat, started being a Republican and supporting Republican national policy.

Visual_Cortex
Visual_Cortex

 the House approved a measure to set a single, flat rate of 5.4 percent. 

Like the collective imbeciles that they are.

People actually VOTE for these "representatives"? Good God, why not just eat rat poison?

Visual_Cortex
Visual_Cortex

@Kyle_Wingfield @Visual_Cortex

Granted, the damage was done in 2014 when Georgians dutifully did as they were told and gave the wealthiest residents the bestest prize ever via referendum, but this is no less irritating.

Doom a classical liberal
Doom a classical liberal

@Visual_Cortex @Doom a classical liberal @Kyle_Wingfield


Nope. Nothing moronic about it. In fact, its moronic to  not cap it. Reason is that individuals and their businesses would be leary of operating in an environment where the state can simply rake them over the coals if they wanted to by doubling or tripling the state income tax from one year to the next. Clearly, you don't consider investment behavior in your analysis of taxation issues. And that, sir, would be moronic. 

breckenridge
breckenridge

@AndyManUSA#45 

By a large margin Americans want a thorough investigation of the ties between Russian intelligence and the Trump people. And those that don't? They put politics above country.  What a sad and horrible bunch of losers.

AndyManUSA#45
AndyManUSA#45

@breckenridge @AndyManUSA#45 Only a silly little person would believe the whole Russia/ Trump ruse. Number One, what's the worst case scenario if if your most wildest allegations were to be true? Yeah, I have a hard time with it too.


Secondly, if putin did have a butt buddy, his name was obozo clinton.


Grow up.

Resist Trump
Resist Trump

@AndyManUSA#45 @Resist Trump @breckenridge

Depends on what direction that 'close relationship' would lead. If down the path of fascism, it would harm the United States tremendously. If for the betterment of humankind and the advancement of global peace and prosperity, it would be great. If you think that's what Putin is after, I have a bridge to sell you. Located in Roswell. Includes a toll booth to cross the river. Special price today only. For you only. Can't lose investment. You in?

AndyManUSA#45
AndyManUSA#45

@Resist Trump @AndyManUSA#45 @breckenridge That's too vague. I'm talking about actual damages not some simpleton thing about fascism. What do you think him and Putin are after? Example; Do they wish to subvert kalifornia and enslave all the liberals within it?


Try again.

Resist Trump
Resist Trump

@AndyManUSA#45 @Resist Trump @breckenridge

If Trump's tax returns don't contain any smoking guns, why not release them?  If Trump knows there's no trouble vis-a-vis him and Russia, why not have an independent investigation to clear things up? What's he got to lose?

AndyManUSA#45
AndyManUSA#45

@Resist Trump @AndyManUSA#45 @breckenridge Smoking gun, you mean like exchanging uranium mining rights for campaign contributions?


By the way, the IRS has his tax returns and if you truly believe they haven't examined them for political purposes, you must have been born yesterday.

Doom a classical liberal
Doom a classical liberal

@AndyManUSA#45 @breckenridge


"Only a silly little person would believe the whole Russia/ Trump ruse."


Yep. Say what you will about Trump. But the whole Trump is in cahoots with the Russians theme is beyond silly. Its patently absurd. Looks like the Dems now have their very own birther type of nonsensical issue to believe in.