Sweepng changes to Georgia taxes? (Avera: sales, 2014, insurance)

[arjay57]

Some major revisions to Georgia's tax system being debated in the Legislature this year.

http://fiscalresearch.gsu.edu/taxcou...Jan_7_2011.pdf

[JPD]

Care to summarize or shall we all read a 97 pages document before replying?

[arjay57]

Well, here's the Executive Summary on p. 5:

Executive Summary

The mission of the Special Council for Tax Reform and Fairness for Georgians was to conduct a thorough study of the state's current revenue structure and to make areport of its findings and recommendations for legislation no later than January 10, 2011. The initial findings of the Council led to the determination that its recommendations should lead to the betterment of Georgia with the goal of changing the philosophy of taxation from income to consumption, increasing stability of tax revenues, and enhancing the perception of fairness for all. Ultimately, the results of these recommendations are to ensure Georgia as a pro-growth, job-friendly state in line with the 21st century economy.

Reduction of personal income tax 6% rate over time such that rate does not exceed 5% in January 2012, does not exceed 4.5% in January 2013, and does not exceed 4% in 2014.

Corporate Income Tax - Simplify Credits; Maintain Parity with Personal Income Tax Rate

Sales Tax Exemptions - Keep Government Exemptions and Keep Business and Agriculture Input Exemptions;

Food for Home Consumption Exemption - Eliminate Exemption

Casual Sales of Motor Vehicles, Watercraft, Aircraft - Impose Sales Tax on Casual Sales

Impose Sales Tax on Select Personal and Household Services

Cigarette Tax - Raise to $0.68/pack, the Average of Surrounding States

7% Excise Tax on Communications Services

Motor Fuel Tax - Change Rate Structure to Cents per Gallon Rate; Index to Highway Construction

Insurance Premium Tax - Reduce to a Rate of -1.75%

To me it looks like the biggies would be

(1) lowering the personal and corporate income taxes from 6% to 4% by

(2) Eliminating exemptions for personal and corporate income taxes

(3) Raising cigarette and motor fuel taxes to regional average levels

[JPD]

Food tax - - that's not going to go over well, even if they eliminate the state income tax entirely.

[testa50]

Originally Posted by arjay57

Well, here's the Executive Summary on p. 5:

To me it looks like the biggies would be

(1) lowering the personal and corporate income taxes from 6% to 4% by

(2) Eliminating exemptions for personal and corporate income taxes

(3) Raising cigarette and motor fuel taxes to regional average levels

To be clear, only the exemptions that are particular to Georgia (and not replicated by the federal system) would be eliminated (from my reading). So the Federal AGI would be the same as the State AGI. The idea is that you don't have to deal with all of these other special exemptions, so filing is cheaper and easier, easier to review and audit, and you can make the rates lower without the exemptions.

great read btw

Edit: of note, the beloved movie credit would be nixed by this plan.