Our state budget is a clear reflection of Georgia’s priorities. Funding critical programs across the areas of health care, education and public safety requires a stable revenue system capable of keeping pace with the continued growth of our state’s population.
In August 2019, the governor requested that many state agencies begin implementing budget cuts of 4 percent this year (FY 2020, which started July 1, 2019) and 6 percent in FY 2021. Although we are still awaiting the final executive budget that will be submitted to the General Assembly later this month, the information already made public from agency requests suggests that we can expect to see further hiring freezes, pay cuts and staffing reductions that could cause inefficiencies in programs with heavy workloads, such as SNAP enrollment for low-income Georgians.
Meanwhile, in 2018 the Legislature passed a bill cutting the top income tax rate from 6 percent to 5.75 percent. That change went into effect in January 2019. The enacting law also allows the state to pass another reduction to the top income tax rate—to 5.5 percent—this session.
Since the start of the 2020 fiscal year, Georgia’s revenues have been lagging, and this potential cut would only serve to exacerbate the problem. This potential cut to the top income tax rate could reduce revenues $550 million per year. Meanwhile, 75 percent of the total tax cuts per year would go to those with incomes over $100,000.
GBPI decided in late fall of last year to poll Georgians to gauge their sentiments surrounding the state budget, the potential top income tax rate cut lawmakers are looking at, a flat tax that may stem from the top income tax rate cut and ways to raise revenue. The results of our polling were clear: Georgians want a budget that can fund shared priorities, and they understand that this potential top income tax rate cut would harm Georgia families.
Poll highlights include:
- In Georgia, 78.3 percent of people oppose or strongly oppose budget cuts if they touch on public safety, health care and education and 68.1 percent oppose cuts that involve layoffs.
- With 75 percent of the benefits going to those earning over $100,000 annually, 65.1 percent of Georgians oppose the potential top income tax rate cut.
- Over eight in 10 Georgians support a Georgia Work Credit, which would help reduce the amount of income tax low- and middle-income Georgians owe and help them save.
- At 49.6 percent support, a plurality of Georgians would support increased state spending.
- Georgians favor new revenue sources to fund priorities like education and health care, and are interested in raising the tobacco tax to the national average and extending the online sales tax to services, online retailers and use of apps like Uber.
See full results below:
Question 1: Since 2007, spending by Georgia’s state government has grown at the slowest rate in the nation. Do you think the state budget should increase, decrease or stay the same?
Question 2: Many state agencies are now facing the first mandatory budget cuts since the 2008 recession. Most of these budget cuts will affect agencies focused on public safety, health care and education. Do you strongly support, support, oppose or strongly oppose these mandatory budget cuts?
Question 3: Many state agencies are implementing hiring freezes or pay cuts in order to comply with these mandatory budget cuts. Do you strongly support, support, oppose or strongly oppose using such measures?
Question 4: If the state does cut the top income tax rate, this means a middle-income family earning $50,000 per year would save about $5 per month, or about $60 per year. Do you strongly support, support, oppose or strongly oppose cutting the top state tax rate?
Question 5: If the state’s top income tax rate is cut, 75 percent of the total tax cuts per year would go to households with incomes over $100,000. Do you strongly support, support, oppose or strongly oppose cutting the top income tax rate?
Question 6: If lawmakers do cut the top income tax rate, the state will either have to find new sources of tax revenue or cut programs. Would you prefer finding new tax revenue, cutting programs or a combination of the two?
*This answer was not given to respondents, but we recorded if they verbally replied they would prefer no cut.
Question 7: Would you favor or oppose cutting the state’s top income tax rate if it meant increasing the state’s sales tax?
Question 8: Some legislators propose lowering Georgia’s top income tax rate even if it means that the state will need to scale back funding for programs that benefit children, rural communities, or low income families. Do you strongly support, support, oppose or strongly oppose lowering taxes if it means spending cuts to these types of programs?
Question 9: Moving on to another topic, state legislators have proposed another change known as a “flat tax.” Under a flat income tax, all income levels are taxed at the same rate—whether you make $1 or $1 million per year. Do you strongly support, support, oppose or strongly oppose Georgia moving to a flat tax system?
Question 10: Under the current tax system in Georgia, low and middle income earners typically pay a larger percentage of their total income in state and local taxes compared to those with higher incomes. Should every Georgian, regardless of income, pay the same tax rate or should tax rates go up as one’s income goes up?
Question 11: There is another proposal called the Georgia Work Credit that helps families with low to moderate incomes reduce the amount of income tax they owe. The federal government offers a similar credit, as do a majority of states. Do you support the Georgia Work Credit?
Question 12: Would you favor or oppose the following measures in order to fund increased state spending in areas like education and health care: Raising the sales tax on tobacco.
Question 13: Would you favor or oppose the following measures in order to fund increased state spending in areas like education and health care: Extending the sales tax to services, online retailers, and use of apps like Uber.
Question 14: Would you favor or oppose the following measures in order to fund increased state spending in areas like education and health care: Eliminating income tax breaks that benefit those primarily making over $100,000.
Question 15: Georgia currently has one of the lowest tobacco taxes in the nation, with the state tax on cigarettes ranking 49th out of 50 states. Should the state of Georgia raise its tobacco tax to at least the national average?
The Georgia Budget and Policy Institute Poll was conducted November 14-25 and December 1-4, 2019 and included a total of 1,067 (unweighted) registered voters in Georgia. The survey was administered by the School of Public and International Affairs Survey Research Center at the University of Georgia. Interviews were conducted in English. The survey results were weighted using iterative proportional raking in order to ensure the sample was representative of the registrant population in terms of race, sex, age, and education.