House Ways & Means Chair Harrell, Speaker Ralston Announce Tax Cut Package
Speaker David Ralston was the featured guest at today’s Atlanta Press Club luncheon, and he used the occasion to make a bit of news on taxes. With Ways & Means Chairman Brett Harrell in attendance, a tax reform proposal was announced to flatten Georgia’s income tax rates while providing an earned income tax credit. From a press release:
ATLANTA – State Representative Brett Harrell (R-Snellville), chairman of the House Ways & Means Committee, today announced that he will introduce tax reform legislation which seeks to cut personal income taxes. Chairman Harrell made the announcement at the Atlanta Press Club today with Speaker of the House David Ralston (R-Blue Ridge) and House Appropriations Chairman Terry England (R-Auburn).
“Today we are introducing the largest income tax cut for individuals in Georgia’s history,” said Speaker David Ralston. “In 2018, we promised Georgians meaningful tax relief, and this is the second step in delivering on that promise. I appreciate Chairman Brett Harrell’s work on this comprehensive reform package and applaud his commitment to Georgia’s hardworking taxpayers.”
Chairman Harrell’s bill would cut the personal income tax to a flat rate of 5.375 percent. The corporate tax rate, already a flat tax, would remain at 5.75 percent. The initiative would also institute a new Georgia Income Tax Credit for working families to offset the flattening of the tax brackets. Further, the proposal would include tripling the Adoption Tax Credit from $2,000 to $6,000 as the governor has proposed. The plan would go into effect January 1, 2021 and provide approximately a quarter billion dollars in total tax relief each year.
“The initiative responds to the pressing needs of our state in a fiscally responsible way, while maintaining our focus on reducing the burden of government on everyday Georgians,” said Chairman Harrell. “The tax reform measure will keep our promise to our citizens by flattening and cutting the personal income tax rate. This 2020 tax reform package makes Georgia’s tax system fairer, flatter and allows Georgian’s to keep more of their hard-earned money.”
In 2018, the General Assembly passed HB 918 that reduced the personal income tax rate for the first time since 1937 from six percent to 5.75 percent.
Representative Brett Harrell represents citizens of District 106, which includes portions of Gwinnett County. He was elected to the House of Representatives in 2010 and currently serves as the Chairman of the Ways & Means Committee. He also serves on the Budget and Fiscal Affairs Oversight, MARTOC, Regulated Industries, Rules and Transportation, committees. He also serves as an Ex-Officio member on the Appropriations Committee.
A timely note for the usual suspects asking “Why can’t we be like Texas?” when we talk about Georgia’s income tax: Texas generated about 6.7 Billion in direct taxes on oil and natural gas drilling during FY19. I would rhetorically ask you how Georgia would go about finding that kind of revenue from petroleum extraction, but I think that question won’t be rhetorical for Texas lawmakers given what’s going on with oil prices and their threat to the overall shale industry.
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Charlie
Founder of GeorgiaPol.com; Now weekly columnist Very interested in Georgia and Georginas. Interest in politics is waning daily.
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Let’s see–cut income tax, realize revenue shortage, scramble to manage budge, cut income tax again.
I understand it’s an election year and pols love nothing more than showing voters how much they love them. I just hope they stop the cut/scramble cycle before they do a Brownback on the state.
It’s an election year so of course reducing rates even more than those not yet voted on is in the mix.
I’m not much a fan of tax credits. I don’t know the details but expect they’ll go to low income workers that hardly pay any income taxes anyway, when a higher minimum wage instead would make them less dependent on the government. The loss of deductions most beneficial to the middle class will increase taxes on quite a few. Georgia’s tax rate is already very flat, so the rate reduction will disproportionately benefit the rich.