Tuesday, August 21, 2007

Tax reform in 2008

UPDATE: Erick Erickson (blogger, lawyer, Macon city councilman elect, title-hungry agitator) interviewed Speaker of the House Glenn Richardson about the tax reform plan today. Read and hear it here.

Man, it was like they moved half the state Capitol to Perry today for the annual congressional luncheon. I mean you couldn't throw a rock without hitting a state legislator or a lobbyist, which really ups the percentages.

I talked to a lot of folks about the potential tax reforms coming in the next General Assembly session. The idea has gone through several permutations (and is sure to go through more) since the placeholder bill (H.R. 900) was filed at the end of this year's session. But the basic tenets remain: No property taxes, emphasis on sales taxes.

That's been a sticking point for city and county governments (and their powerful lobbying arms, the Georgia Municipal Association and the Association County Commissioners of Georgia), since both get a lot of their money from property taxes.

But not as much as you might think. For example, Macon gets more sales tax revenue each year than property tax revenue.

There's also the issue of local control of tax revenue in general, with the fear being local governments will have to go begging to the state to get their piece of the pie.

Last week a group from the ACCG, including association president and Houston County Commissioner Tom McMichael, met with Speaker of the House Glenn Richardson about the tax reform proposal, which Richardson is spearheading. McMichael described it as a productive and cordial meeting during which a lot of questions were answered and myths set aside, though a lot of questions remain.

The ACCG followed that meeting with a letter sent to all 159 of Georgia's counties, and you can download it on the association's Web site to get an idea how the debate is shaping up.

Long way to go before these groups sign on the dotted line to support this thing (or to oppose it), but state Rep. Larry O'Neal, a co-sponsor with Richardson on the initial H.R. 900, said he's optimistic despite the fact that this would be a radical overhaul of state tax policy.

I plan to break the plan down this fall, but think it's prudent to wait for a few more details to fall into place, which will happen as more people are brought into the fold. O'Neal, who chairs the tax-code-writing Ways & Means Committee in the House, said the plan is to start hearings on this thing in September.

CORRECTION: I changed references to H.B. 900 (which doesn't exist) to H.R. 900 (which is what I meant to write about).

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