Georgia

The House passed its “Tax Cuts and Jobs Act” November 16th and the Senate passed its version December 2nd. Both bills would raise taxes on many low- and middle-income families in every state and provide the wealthiest Americans and foreign investors substantial tax cuts, while adding more than $1.4 trillion to the deficit over ten years. The graph below shows that both bills are skewed to the richest 1 percent of Georgia residents.

The Senate tax bill released last week would raise taxes on some families while bestowing immense benefits on wealthy Americans and foreign investors. In Georgia, 60 percent of the federal tax cuts would go to the richest 5 percent of residents, and 19 percent of households would face a tax increase, once the bill is fully implemented.

The Tax Cuts and Jobs Act, which was introduced on November 2 in the House of Representatives, includes some provisions that raise taxes and some that cut taxes, so the net effect for any particular family’s federal tax bill depends on their situation. Some of the provisions that benefit the middle class — like lower tax rates, an increased standard deduction, and a $300 tax credit for each adult in a household — are designed to expire or become less generous over time. Some of the provisions that benefit the wealthy, such as the reduction and eventual repeal of the estate…

The “tax reform framework” released by the Trump administration and congressional Republican leaders on September 27 would not benefit everyone in Georgia equally. The richest one percent of Georgia residents would receive 74.8 percent of the tax cuts within the state under the framework in 2018. These households are projected to have an income of at least $552,200 next year. The framework would provide them an average tax cut of $83,070 in 2018, which would increase their income by an average of 4.0 percent.

A tiny fraction of the Georgia population (0.6 percent) earns more than $1 million annually. But this elite group would receive 50.0 percent of the tax cuts that go to Georgia residents under the tax proposals from the Trump administration. A much larger group, 50.0 percent of the state, earns less than $45,000, but would receive just 5.6 percent of the tax cuts.

Earlier this year, the Trump administration released some broadly outlined proposals to overhaul the federal tax code. Households in Georgia would not benefit equally from these proposals. The richest one percent of the state’s taxpayers are projected to make an average income of $1,892,900 in 2018. They would receive 58.5 percent of the tax cuts that go to Georgia’s residents and would enjoy an average cut of $120,130 in 2018 alone.

A new report by the Institute on Taxation and Economic Policy (ITEP) and AASA, the School Superintendents Association, details how tax subsidies that funnel money toward private schools are being used as profitable tax shelters by high-income taxpayers. By exploiting interactions between federal and state tax law, high-income taxpayers in nine states are currently able […]

One of the most important functions of government is to maintain a high-quality public education system. In many states, however, this objective is being undermined by tax policies that redirect public dollars for K-12 education toward private schools.

Georgia lawmakers ended their legislative session Thursday by enacting a few tax credits and smartly choosing not to pass a major income tax cut that had been working its way through the legislature. Policymakers in other states should take note and follow Georgia’s lead by rejecting costly and inequitable flat-tax and other high-income tax cut […]