The bill originated in the state House last year as HB 238 with an aim to provide tax relief for aquariums. But the legislation was gutted and became the vehicle for Senator Judson Hill (R-Marietta) to provide a reduction in the state’s top personal income tax rate. The bill, as passed by the Senate, also seeks to increase personal exemptions as well as eliminating Georgia’s corporate net worth tax.
Recent polling shows the legislation receiving nearly an 80 percent approval rating with voters. But the approval rating is reportedly lower with Governor Nathan Deal and House leadership. The Deal administration reportedly claims that the reduction in taxes would endanger the state’s top bond ratings with agencies such as S&P and Moody’s. And some Democrats are siding with Governor Deal in claiming that needed revenue for social services would be lost should the tax cut be passed.
House leaders have reportedly been told to put the tax break measure on ice with just days to go in the legislative session. But over the weekend Republican members were reportedly questioned over their support of the tax cut by GOP activists who gathered at various county conventions to choose delegates to GOP district, and potentially, the Republican state convention in June.
“In a state where Donald Trump won hands down, it’s hard to support Republican (officials) who can’t pass even the slightest of tax cuts” said a highly placed GOP official from Cherokee County. And that view sets the seemingly prevailing Republican activist view as the House sits on the legislation with just days to go.
While most financial experts doubt claims that Hill’s tax cut would place the state in harm’s way with the various entities that rate credit worthiness of cities and states, there seemed to be little doubt going into the final week of the 2016 legislative session that Governor Deal’s office was leaning hard on House leaders to kill the measure. “We’ve been told it is dead” said one House GOP member. “The problem is” the member went on to note “we will be the ones who pay the political price down the road. The public no longer accepts us saying that we did not get to vote on a matter, now they ask what we said or did to try to make it happen.”
The year has been a tough one for Governor Deal. The legislature has handed him a controversial “religious freedom” bill and equally controversial “campus carry” gun legislation—both of which Deal may well veto. One state senator who voted for the bill noted “We voted to give the NFL a tax break for future Super Bowl tickets but then get kicked by the NFL and the Falcons ownership for passing religious freedom. Now it is insult to injury. I mean we can pass a tax cut for the big shots who buy tickets to a game that ordinary Georgians have no hope of attending, but we can’t reduce their tax rates when states around us have, or where they don’t even have one (income tax)?”
One potential 2018 gubernatorial candidate, Lieutenant Governor Casey Cagle, is not likely to lose any sleep over the issue. Cagle helped push Hill’s measure through the Senate and will likely carry his efforts as a badge of conservative honor into any GOP primary to replace Deal.
When asked about the political implications of the tax relief measure, pollster Matt Towery, Jr. of Opinion Savvy, who has polled the presidential primaries for FOX affiliates in five states this year (and for the Morris Newspapers) said “This is not even on the average voter’s radar right now…I mean no one pays attention to these things except the elected officials and political fanatics.” But he adds “Oh yes, when opponents raise it in future campaigns, the whole game will change. This is the most anti-tax, anti-government wave we have seen, or certainly I have seen. And the dislike people have for Washington is spilling over the state legislatures.”