Tax Panel Endorses End of Property Taxes

(L to R) GRA Board Member, Jeff Wansley of Equifax, Inc. with the House Ways and Means Panel: Larry O'Neal (Chair), James Mills, Ron Stephens and Martin Scott.

At the GRA Annual meeting and Legislative Conference, a panel of tax experts comprised of Ways and Means Committee Chair, Larry O’Neal, Economic Development and Tourism Chair, Ron Stephens, Banks and Banking Committee Chair, James Mills and Ways and mean Committee Secretary, Martin Scott, all called for the abolishment of the ad Valorem inventory tax. While they found the ad Valorem property tax to a special problem for the state, they went on to say that they support the abolishment of all property taxes. While they found the ad Valorem property tax to a special problem for the state, they went on to say that they support the abolishment of all property taxes.

On the prior day, June 4th, Jerry Keen, House Majority Leader had described the tax reform package supported by Speaker Richardson. This package would eliminate all taxes in Georgia except for a 4 percent sales and usage tax and a 4 percent income tax. Majority Leader Keen said that 4 + 4 = 0. That’s a four percent sales and usage tax and a 4 percent income tax would result in zero in other taxes.

For retailers, who have been the sole traditional collectors of sales tax, spreading the burden across all fields of endeavor as a usage tax would be a fair and reasonable way of sharing the costs of supporting government. Under the proposed law, every profession and service would collect and remit the sales and use tax. Those 110 special interest areas currently getting preferential treatment via sales tax exemptions would be eliminated.

Georgia’s retailers would gain tax relief with the elimination of the ad Valorem property tax as well. None of the southern states abutting Georgia have an inventory tax. And Georgia is the one of only ten states that still levies this anti-business tax.

According to Chairman O’Neal, the current tax code was written when Georgia was primarily an agrarian state. Now our economy is a service-based economy and the tax system needs to reflect the change as well.

Schools and local governments, who are expected to oppose the proposed tax changes, would be indemnified by having their revenue protected by being the first to be funded under the proposed changes.