Chamber: Tax Reform Measures Key To Georgia’s Economic Future

It’s no secret that the Georgia Chamber has been a driving force behind Georgia’s tax legislation that sailed through the legislature last week with barely a whimper of institutional opposition.  In the following Op-Ed, Chris Clark, President and CEO of the Georgia Chamber of Commerce offers his thoughts on the legislation. 

The past few years have not been easy for our state.  Georgia took a tough hit during the last recession and we have all heard about or experienced the impacts of a down economy firsthand. 

While there is still a long road ahead to recovery – we are finally seeing some consistent signs that we are heading in the right direction.  State revenues are trending up, unemployment is trending down, and the first three months of this year have all included significant economic development announcements.

The General Assembly passed two bills last week that will without question help us continue these positive trends.  Based on the work of the tax reform council that met throughout 2010 and the competitiveness initiative spearheaded by Governor Deal that gathered input from business leaders across the state last year, significant measures were developed that will allow Georgia to help our existing companies, attract new investment, and retain our rightful position as an economic leader.

The Georgia Chamber was proud to play a role in this process, and we commend our elected leaders – on both sides of the aisle – for understanding just how important these measures are for businesses and families throughout the state.

As soon as the Governor signs HB 386 and HB868, our state will begin to see the benefits of:

 ·        Putting Georgia on an even playing field with other states in the Southeast and across the nation by phasing out the sales tax on energy used in manufacturing, mining and agriculture – three industries that play a key role in our economy.

 ·        Updating the state’s economic development tax credit and incentive programs in a way that makes us competitive with the rest of the nation and will ensure results with regard to job creation and investment.

 ·        Bringing back sales-tax holidays for school supplies and water efficient products which will save Georgians money and provide a boost to our border communities.

 ·        Leveling the playing field for home-grown companies by clarifying current on-line sales tax laws to include purchases from out-of-state businesses.

 ·        Making changes to personal tax measures including the “birthday tax” and marriage deduction that will put more money back into Georgian’s pockets

 These measures, along with others included in the legislation, are a critical step forward in our quest to make Georgia the very best state in the nation in which to do business.  Just as important is the signal this sends to economic developers, site selectors and companies determining where they want to invest.

With the passage of these bills – we have let the world know that Georgia is open for business, willing to provide the support companies need to be successful, and mindful of the impact of tax policies on those who call our state home.  As a result, our road to recovery will be much easier to travel.

13 comments

  1. On the Internet tax portion of the bill… there are over 100,000 Internet retailers in the US. About 2,000 of them have affiliate programs. About 500 of that 2,000 already have a physical presence in GA and are already collecting sales tax. Another 500 out of the 2,000 have no affiliates in GA and are not subject to this law change. Bottom line? Only 1%… 1,000 out of 100,000 Internet merchants will be covered under this law change and many of those will fire their GA based affiliates and still NOT have to collect GA sales tax.

    So brick & mortar stores in GA will still have the unlevel playing field they are complaining about… GA and her local governments will not receive the millions in additional revenue they want… 6,000 GA based affiliates will be forced to shut down or move to another state… and the state will lose the incomes taxes it collects on the $483 million annually that GA based affiliates earn… and that $483 million will no longer be spent in GA stores costing the state and local governments millions in lost sales tax revenues. Three states that passed similar legislation have already backtracked and rescinded the bills.

    As for me? This 9th generation Georgian spent the weekend up in TN looking at land to relocate to. I was a lifelong Republican until March 23, 2012… I’ll never vote for another Republican again as long as I live. We supplied the state legislators with tons of information proving that they should strip this unconstitutional Internet tax provision out, but they refused to even listen. I mailed personal letters to over 100 legislators, followed up by e-mails, and phone calls. I only got a response from 3… my state rep Christian Coomer, my state senator Barry Loudermilk, and Chip Rogers. I spent 25 years helping to build this party in this state… donating time, money, resources… managing campaigns, training legislative candidates… and I can’t even get a response to a letter or phone call?

    There was a nice article front page of AJC Metro section on Sunday showing the money trail of lobbyist campaign donations, gifts, trips, etc that led up to the writing and passage of 386… examine the bill closely and you’ll see that virtually every section had lobbyist fingerprints all over it. Sad day for GA.

  2. debbie0040 says:

    We are encouraging online retailers to fight this and not give in or make a deal with the state….Chuck, contact me, we are working on something in regard to July 31, you may be interested in…

  3. CobbGOPer says:

    Thanks Mr. Clark. Really looking forward to the new CofC marketing campaign:

    “Do Business In Georgia – We will screw our citizens to the wall if you’ll just locate your corporate headquarters here!”

    How long before we start exempting CEOs from state income taxes if they’ll just please, please relocate to Atlanta… pretty please?

  4. KD_fiscal conservative says:

    This bill is a text book example of crony capitalism at its worst. How stupid do these GOP’ers think we are. Giving special tax breaks that benefit only a few special lobby’s is NOT free market at work. I can see a few provisions in this bill that may be nessecary to compete with other states( ie the energy tax deduction). As usual, there are all kinds of goodies for Deal and companies lobbyist buddies. To make it worse, they straight up like to the good people this state by claiming this is a tax cut for Georgians, when in reality it is a tax cut for a select few industries, while actually hurting others. Also known as picking winners and losers.

    Debbie, I do appreciate your work trying to oppose this bill, but considering all of the establishment Repub. types are in full support of it. But I still worry about this, let’s primay’em technique of pressuring legislators, with TP candidates b/c often times these candidates(if they win) just end up voting NAY on every bill(see Broun or Graves for examples at the federal level). They almost never get enough support for there ideas to get anything actually passed and signed into law.

  5. Calypso says:

    “How stupid do these GOP’ers think we are.”

    If that’s not just a rhetorical question, the answer is, “Stupid enough to elect them to super-majority in both houses.”

  6. Dave Bearse says:

    Did those in charge of the changeover to a 7% car title tax bother to consider that the changeover is going to cost Georgians that itemize for income tax purposes a chunk of change in the form of additional income taxes each year?

    Take a look at your vehicle registration to determine how much you’re paying in ad valorem taxes. I aniticipate most readers that itemize for income tax purposes will find themselves paying either 21% or 31% of that ad valorem tax amount in additional federal (15% or 25%) and state (6%) income taxes. But hey, what’s an additional $50 or $100 a year in income taxes when your “reforming” state taxes?

    While on the subject, did the additional state income tax that will be collected because ad valorem taxes will no longer be paid (and hence not be deductible) factor into revenue neutrality, or did a quarter of the legislature violate its pledge to not increase taxes?

    What designs do the powers that be have on the tax revenue bump in 2013 and for a few years thereafter, when the state is collecting the 7% title tax on all newly retitled vehicles, and ad valorem taxes on all the others? (How about a a few year ad valorem tax exemption for motor carriers? Just a little somethin’, somethin’ for all the hard work the Chamber put into tax reform in wining and dining guys like Don Balfour, and may quite nicely be revenue neutral too!)

    Please enlighten me GaGOPers. I’m told the process and its results are transparent, but we Dems don’t have the secret de-coder ring.

  7. toml99 says:

    A very superficial “analysis” of the benefits of the latest political pork. Say what you want about the other measures, but the affiliate tax issue has been tested time and again in other states. And the bottom line is — there will be $0 (that’s zero) in additional taxes collected from online merchants after they terminate their Georgia affiliate agreements.

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