UPDATED: GlennTax evolves again…

Surprise, surprise…another version of the Speaker’s tax proposal, now called the Property Tax Reform Amendment (SR 796 and HB 979), was presented to members of the State House this morning. You can view the details of it here.

This proposal seems decent at first glance, though there is nothing here that limits state spending which as much of a concern as local spending. Also, there is no guarantee that the legislature won’t raise taxes in another area to make up for the billion dollar tax cut with the elimination of the car ad valorem tax, and they have given us no indication that they are serious about cutting spending.

Anyway, here is what the amendment does, and I’m pulling most of this straight from the fact sheet:

  • eliminates all property taxes (ad valorem) on personal vehicles by July 1, 2010
  • freezes all tax assessed value on all real property as of 2008 values and limits how much they grow
  • caps revenue growth of a local government at 2008 amount plus inflation, plus new contruction
  • allows local governments to put a question on the ballot if they wish to spend above rate of inflation
  • funds statewide trauma care at $10 per vehicle
  • local school board have local legislation submitted through the General Assembly and submit a ballot question to voters in order to spend above 20 mill limit

The exemptions on the 175 services are still in place in this new proposal.

[UPDATE] The proposal has gained the approval of Grover Norquist and Americans for Tax Reform and the Americans for Prosperity, who sent out an action alert this afternoon urging their members to contact their representative to support the bill.

[UPDATE II] Here is the letter sent to legislators from Americans for Tax Reform.

9 comments

  1. caps revenue growth of a local government at 2008 amount plus inflation, plus new contruction

    I’d like to see this applied to the Legislature as well.

    The GREAT plan seems to get better with each iteration. I’ve criticized the Speaker for some stuff but he deserves credit for forcing tax reform to the front burner.

  2. Harry says:

    Far as I can tell, it adds a raft of new taxes and controls without reducing existing taxes; that is, except for the vehicle tax, which is not such a great a burden on those who don’t find it necessary to buy a new vehicle every couple of years.

  3. BobG says:

    “# freezes all tax assessed value on all real property as of 2008 values and limits how much they grow;
    # caps revenue growth of a local government at 2008 amount plus inflation, plus new construction”

    A financial disaster for local government and completely contrary to Republican principles of smaller government and less regulation. This will be back before the Legislature within three years so that they can fix their screw-up.

    The ignorance of those in the Legislature is inexcusable, especially when the best (actually, only) solution is so easy:

    http://www.millagerate.com

  4. Donkey Kong says:

    Look, I know that tax cuts are the hot thing within the party these days, but tax cuts are relatively useless without spending cuts in reducing the size of government. In fact, under Bush, the size of government managed to skyrocket during tax cuts. I know some conservatives like to claim the tax cuts created tax revenue, and there is an argument for that, but since when is it conservative to celebrate the growth of government in the first place? If tax cuts spur greater tax revenue, that leaves even more room to cut taxes. The real burden of the government is not just on taxes but spending. Let’s cut spending hand-in-hand with taxes. Cap the growth of the state at a rate of inflation plus/minus population growth/decline, and any attempt to spend more than this requires approval from the people, whose money it is in the first place.

  5. Donkey Kong says:

    I know. It’s not that realistic to hope for, but hey its what we know is right. Would be great to see politicians start acting more in this regard.

  6. bowersville says:

    Cut spending? They already have a pat answer. The Georgia Constitution requires a balanced budget. We already control spending. What an ironic hoot.

  7. John Konop says:

    Donkey Kong

    The problem is much of the budget for expenses like schools are on cash basis with no future liabilities taking into consideration like social security which in our world you would go to jail for. That is why programs like Peachcare, schools… are a race by politicians for a shell game of sticking tax payers with tax increases hoping we do not notice.

    You are right we need zero base budgeting with a freeze on increases unless tax payers approve it. But tax payers must also understand what the real future liability to understand what or who they are voting for.

    Any actuary will tell you that Lawmakers State and Federal have signed up tax payers with way more future liabilities than we could ever collect in tax revenue. And with the debt market catching up with this irrational fiscal policy this is a perfect storm that is ready to hit.

  8. Donkey Kong says:

    “The problem is much of the budget for expenses like schools are on cash basis with no future liabilities taking into consideration like social security which in our world you would go to jail for.”

    I agree. Together with Indy, as our resident accountants (he far more knowledgeable and wise than I, behind Rugby and his indelible committee, of course), we should push for accrual based accounting with an annual report prepared for taxpayers based on GAAP. Honestly. I think the taxpayers deserve to know the estimated future liabilities that they and their children will be required to pay.

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