Georgia Budget and Policy Institute: House Proposes Massive Tax Cuts for Wealthiest, Slashing State Revenues
ITEP Work in ActionMembers of the Georgia General Assembly are considering legislation that would fundamentally change the structure of the tax code and result in disproportionately large tax cuts for the wealthiest while hundreds of thousands of families would see tax increases or few benefits. This is due to the package’s proposed flat personal income tax rate and a mammoth price tag in excess of $1 billion per year that threatens to jeopardize funding for public education and health care.
Evaluated in its entirety, the package would direct 62 percent of approximately $1 billion in net tax cuts, or $620 million annually, to those in the top 20 percent—earning over $109,000 per year. While proponents have claimed that “95 percent of Georgians would pay less in taxes under the plan,” in reality, this analysis finds that only 62 percent of taxpayers (3 million) would benefit from a net tax cut, while 28 percent (1.4 million) would experience no change and 10 percent (506,000) would see a tax increase. Furthermore, with a $1 billion expected fiscal impact that would slash state income tax revenue collections, it is likely that future tax increases or spending cuts necessary to cover the revenue lost to the state would most affect low- and middle-income Georgians.