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ATLANTA – Two tax bills left for dead in the General Assembly have been resurrected in the waning days of this year’s legislative session.
The Georgia House of Representatives late Friday overwhelmingly passed legislation that originated in the state Senate as a two-page bill.
However, as Senate Bill 6 went through the House Ways and Means Committee, two much longer bills that appeared headed for failure were attached to it, making them eligible for passage during the last two days of the session next week. The measure has now grown to 31 pages.
The original Senate Bill, introduced by Sen. John Albers, R-Roswell, calls for outside audits of up to five state tax credits each year to determine whether they’re creating enough jobs or generating enough economic development in general to make them worth their impact on the state’s revenue.
“This is a great opportunity for us to look at [tax credits] that are performing well … and others that may need to be tweaked or changed,” Albers declared back in January when his bill went through the Senate Finance Committee.
Another tax bill that has been added to Albers’ measure also originated in the Senate as a project of Sen. Chuck Hufstetler, R-Rome, the Finance Committee’s chairman.
Senate Bill 148 would create two review panels to study Georgia’s tax and revenue structure and draft legislation to rein in wasteful spending on tax breaks.
A similar review the state undertook at the beginning of the last decade led to tax reforms that eliminated Georgia’s “birthday” tax on motor vehicles, phased out the state sales tax on energy used in manufacturing and expanded an income tax exemption for married couples filing jointly.
“Georgia did something that worked really well back in 2010,” Hufstetler told his Senate colleagues last month before they passed it unanimously. “It’s time to do that again.”
But the House shot down Hufstetler’s bill overwhelmingly last week with only 20 lawmakers voting “yes” and 139 opposing it.
However, those 20 supporters included several Republican leaders, notably House Speaker Pro Tempore Jan Jones, R-Milton; Majority Leader Jon Burns, R-Newington; and Ways and Means Committee Chairman Shaw Blackmon, R-Bonaire. Their influence allowed it to be brought back on Friday attached to Albers’ bill.
The House also strongly supported a third tax bill that originated in that chamber and passed that chamber overwhelmingly but has struggled in the Senate.
House Bill 587 includes a smorgasbord of new tax credits billed by supporters as a way to help businesses across Georgia struggling through the coronavirus pandemic.
The Georgia Economic Renewal Act of 2021 would offer tax credits to manufacturers of medical devices and pharmaceuticals, the aerospace industry, boat repair companies along the coast, performing arts venues and short-line railroads.
“Our economic renewal and recovery will create jobs and spur growth in several industries in Georgia,” House Speaker David Ralston, R-Blue Ridge, declared on the House floor early this month.
The Senate has yet to bring the bill to the floor for a vote. In an opinion column published by Hufstetler’s hometown newspaper, the Rome News-Tribune, the senator cited a fiscal note on the bill indicating the proposed tax breaks combined would cost the state almost $1 billion.
“In Georgia, we collect about $14 billion in income taxes a year, but we give out about $10 billion in sales tax exemptions and tax credits,” Hufstetler wrote. “Think about how low the income tax rate in Georgia could be if we phased out most of these credits.”
That bill, too, is now attached to Senate Bill 6, which creates a conundrum for lawmakers as it heads back to the Senate.
They will have to decide during the last days of this year’s General Assembly session whether to support legislation that on one hand seeks to bring additional scrutiny to Georgia’s tax credit largesse and adds an expensive set of new tax breaks on the other.