Today Americans for Tax Reform sent a letter to Governor Nathan Deal and the Georgia General Assembly confirming that amended tax reform legislation does not violate the Taxpayer Protection Pledge. The bill will cut personal income tax rates while broadening the sales tax base, but does not constitute a net tax increase.
The revenue neutral proposal is a significant improvement from its first iteration, which constituted a large net tax increase. ATR opposed the initial proposal, as it was in violation of the Taxpayer Protection Pledge, a written promise to oppose all tax increases. Gov. Deal and 54 Georgia legislators have signed the Pledge.
The new proposal brings Georgia’s personal income tax down from 6 percent to 4.5 percent while taxing casual sales, auto repairs and communications. It also adds a $163 million tax exemption for energy. The new bill achieves revenue neutrality by eliminating some of the largest and most harmful tax hikes from its initial language, including tax increases on groceries and tobacco, both of which would have hit Georgia’s small business community.
“I have been pleased to work closely with the tax reform council and the state legislature over the past few months to help craft quality tax reform legislation in Georgia,” said ATR President Grover Norquist. “The final product is something conservatives in the state can support: a serious reduction in marginal tax rates that does not grow the size of state government.”
“I commend the legislature and Gov. Deal for recognizing that tax reform can never include tax increases,” Norquist continued.That axiom is reflected in this amended legislation, which is in compliance with the Taxpayer Protection Pledge.”
“Reducing the personal income tax rate is especially important for Georgia, as it is wedged between two states which levy no personal income tax at all,” Norquist concluded. “As Gov. Deal and the legislature continue to work together to reduce the size and burden of state government, the next goal is clear: Scrap the income tax altogether.”