A new poll found lukewarm enthusiasm among Georgia voters for a plan to cut the state’s income tax rate when lawmakers are being asked to slash about $200 million from this year’s budget.
The survey shows that about 42% of voters support the costly tax break when told the change would only save a family earning $50,000 a year about $5 per month. Only about 8% of respondents said they felt strongly about seeing the tax break happen – the second reduction to the state income tax rate in two years.
That backing falters – dropping to 31% – when voters are told that three-fourths of the tax cuts would go to those earning more than $100,000 a year.
And the support erodes even faster when voters were asked if they would support the tax cut if it meant scaling back programs that benefit children, rural communities and low-income families. About 75% of respondents said they oppose the tax break if it means cuts to these programs.
The poll was commissioned by the Georgia Budget and Policy and Institute and conducted by the University of Georgia’s School of Public and International Affairs Survey Research Center.
Lawmakers are set to decide this session whether to shave one-quarter percentage point off the income tax rate, bringing it down to 5.5%. The vote was planned back in 2018, when lawmakers cut the rate from 6% to 5.75% in anticipation of a potential windfall created by federal tax law changes.
Two years later, though, state revenues have fallen flat, and sluggish income tax collections partly to blame. In response, Gov. Brian Kemp ordered state agencies to cut 4% from this year’s budget and 6% from next year’s, and lawmakers will be asked to finalize those reductions this session.
Danny Kanso, a policy analyst with GBPI, said during a call with reporters Thursday that a year’s worth of revenue data should be sobering enough to steer lawmakers away from a second cut that would cost the state another $550 million.
“It’s very clear that Georgians do not want to cripple the state’s revenue system and take adverse action that could really affect those critical budget priorities,” Kanso said, referring to the poll.
But the prospects of another tax cut are still very much alive.
House Speaker David Ralston said Thursday during his annual pre-session briefing with reporters that he views the income tax cut as a “commitment that we made to the people of Georgia, the taxpayers of Georgia.” That pledge, he said, was to roll out the cut in two installments so taxpayers receive a full half percentage point cut.
“I’m hopeful that we can do that,” Ralston said. “I know there’s a lot of support in the House to do that. We can’t do everything, obviously.”
The powerful Blue Ridge Republican said there may be renewed interest in pursuing new revenue sources, such as closing a loophole that allows some third-party businesses to skirt the sales tax on online purchases. Traction on such legislation, he said Thursday, could progress early in the session.
But Ralston said he sees proposals to raise taxes – like a cigarette tax hike – as “non-starters.” He didn’t, however, seem to rule out a tax on vaping products, which has already been floated in the Senate.
Raising taxes on cigarettes may not be so off-putting to voters, though. About 77% of respondents to the GBPI poll said they would support increasing the sales tax on tobacco products if it meant more money for education, health care and other public services.
The same poll found less support for extending the state sales tax to online retailers and rideshare services like Uber. About 58% said they favored that approach.