House Bill 1437, signed into law by Gov. Kemp after a final version emerged during the last hours of Sine Die 2022, sets Georgia on course to make fundamental changes to its income tax that primarily benefit the state’s highest earners at an annual cost greater than $2 billion when fully implemented.
Beyond adding to existing disparities in income by directing approximately 68 percent of all tax cuts to those in the top 20 percent, the changes would also widen the gaps across income and wealth between white and Asian households, who tend to already make higher than average incomes and would benefit from the greatest share of tax cuts, and Black and Hispanic Georgians, who on average earn lower incomes and see the fewest savings.
Although the legislation requires overall revenue growth of at least three percent to proceed without interruption through seven steps to achieve full implementation by 2030—if no delays are initiated—forgoing $2 billion in annual personal income tax revenues threatens the long-term stability of Georgia’s revenue system and places a continued burden on the state’s ability to meet the needs of its residents. Already, Georgia ranks No. 48 out of 50 in the amount of general state revenues it raises per person.