House Democrats Oppose Tax and Pretend Proposal

Caucus votes to oppose HB 387
Atlanta, Ga. – March 29, 2011 – Georgia House Democrats this morning voted to oppose a tax proposal by Republicans that would raise income and sales taxes on the middle class.

“The tax council proposal of HB 387 is a shell game. Republicans have proposed raising taxes on the middle class. They’re quick to say that they’re lowering the income tax rate for most Georgians. What they don’t say is that they’re also eliminating many exemptions that help Georgia families.  They are taxing the middle class, but pretending not to,” said Rep. Brian Thomas, chairman of the House Democratic Caucus.

Thomas said House Democrats were eager to see real tax reform in Georgia. The state’s tax code is in dire need of update and reform. A tax council measure that passed the legislature last year, promised a wholesale overhaul of the state’s outdated tax system.

“While HB 387 contains some positives, it is insufficient as tax reform policy. Consumption taxes are inherently unpredictable, and this plan relies exclusively on three new sales taxes to accommodate its goals. Too many uncertainties exist – who pays more to make up the difference, the impact on middle class earners and rural families, and the narrowness of our margin of error.  In a time of fiscal unrest, cherry-picking winners and losers without a fallback position is a gamble we can ill-afford,” said Rep. Stacey Abrams, House minority leader, a tax attorney.

Republicans have dubbed HB 387 a jobs bill. But during the worst economic downturn in anyone’s memory, the GOP has failed to deliver any new jobs or any plan to create new jobs.

“The Tax Council proposal is not a jobs bill. The only news jobs created under this measure would be in the state’s revenue department,” said Rep. Virgil Fludd (D-Tyrone).

Fludd said the two percent decrease in tax liability isn’t large enough for a small business owner to hire a single Georgian.

Assuming even a substantial tax cut of $8,000 for taxpayers in the higher brackets, if this is an owner of a small business, she will not create a single new job.  These tax changes will not spur growth or investment, Fludd explained.

“While the legislature has had four months to focus on job creation and employment opportunities for Georgia’s families, Republicans haven’t delivered the first bill to address the worst employment climate in the state’s history and an unemployment rate of 10.2 percent,” said Fludd.

House Democratic Caucus Whip Rep. Carolyn Hugley said the HB 387 tax proposal is too little, too late.

“The GOP has dismissed the recommendations of their own Tax Council. They’ve abandoned their own solution by ignoring the recommendations made by their own appointed council,” Hugley said.  “A bill given three hearings – the first without a bill, the second with a bill delivered as the meeting starts and a third on the very next day is poor management.  This is worse than the process Republicans decried during the health care debate.  At least that bill was available for the general public to review.”

Hugley said Republicans waited until the session was nearly over to introduce their major tax legislation, inviting only a chosen few to discuss the details. Millions of Georgians voices have not been heard.

“We can’t continue to rush important policy decisions if we want to improve Georgia’s antiquated tax code. Republicans removed some of the most promising items proposed by the Tax Council. We need to slow down and solicit citizen input before crafting and voting on a comprehensive tax reform package,” Hugley said. “Georgia families deserve better than Tax and Pretend Republicans.”