Georgia Voters To Decide Whether to Cap State Income Tax Rates

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Posted by Will Upton on Wednesday, October 22nd, 2014, 5:00 AM PERMALINK

On November 4, Georgia voters will decide whether to adopt Amendment A: “To prohibit an increase in the state income tax rate in effect January 1, 2015 (Senate Resolution 415).” The ballot measure is a legislatively referred constitutional amendment that would cap the state income tax at the effective rate on January 1, 2015. This would mean that the state legislature would be constitutionally prohibited from increasing the state income tax rate any higher. The measure reads: “Shall the Constitution of Georgia be amended to prohibit the General Assembly from increasing the maximum state income tax rate?” 

If passed, the Constitution of Georgia would be amended with the addition of Paragraph IV in Section 3 of Article VII reading: “Paragraph IV. Increase in state income tax rate prohibited. The General Assembly shall not increase the maximum marginal rate of the state income tax above that in effect on January 1, 2015.” This would have the effect of enacting a supermajority requirement to increase income taxes in Georgia as the state constitution would need to be again amended to do so.

David Shafer, the President Pro Tem of the Georgia State Senate and sponsor of the referendum, said of the effort to cap the state income tax: “It makes it clear that our income tax rate is not going up. It helps increase our competitiveness by pointing out to businesses making expansion decisions that while other states could increase their rates tomorrow our rates are constitutionally capped.” The Atlanta Journal Constitution quoted Jeffrey Dorfman, a professor of agricultural and applied economics at the University of Georgia, in support of Amendment A: “It’s the credibility thing: If businesses feel like they can trust you, then they’re more likely to create jobs in your community. So this cap signals to businesses, we promise we’re not going to become New York or California or Illinois. We’re going to stay a good place to do business.”

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