Governor Highlights Tax Breaks in Amended Georgia Budget
ATLANTA (AP) — Georgia Gov. Brian Kemp said Monday that he has delivered on campaign promises of tax breaks by signing an amended budget.
The Republican said he signed House Bill 18 on Friday, boosting spending by $2.4 billion through the June 30 end of the budget year. That includes nearly $1 billion for a property tax break and also diverts nearly $1.1 billion in state revenue to the state Department of Transportation to make up for uncollected fuel taxes while gas and diesel taxes were suspended.
The state Senate is scheduled to debate a separate Kemp-backed bill Tuesday that would issue another $1 billion of state income tax refunds for a second year. Senators will also consider separate legislation ratifying Kemp’s extension of the fuel tax break.
“While some at the federal level are pushing a budget that raises taxes on Americans, we’re giving the money back to the people through our budget, because they know best how to use it,” Kemp said in a speech at the state Capitol. .
The budget will now spend $32.6 billion in state tax money in the budget ending June 30, up 7.3% from original projections last year. Including federal and other money, total spending would rise to $61.5 billion.
Under the $950 million property tax rebate plan, Kemp says taxpayers with homestead exemptions will get an average of about $500 from the state. Taxpayers will get state income tax refunds of $250 to $500 under House Bill 162, set for debate Tuesday. As with the first year of rebates last year, no one can get back more than they paid in state income taxes in 2021.
Kemp portrays those givebacks as helping people cope with inflation, although economists say adding money to the economy makes inflation worse overall.
Even after the spending plans, Georgia is likely to finish the year with more than $5 billion in unspent surplus cash, Kemp said he’s still considering what to do with that money, but highlighted the value of holding onto cash, on top of the state’s existing rainy day fund. At $5.24 billion, that fund is filled to its legal 15% cap of annual tax revenue.
“It’s also important for us to have reserves if we see a true recession and a true downfall in our revenues, because when that happens, that is when our citizens will need government services a lot more than they do right now,” Kemp said.
Besides the tax break, the amended budget includes one-time $500 bonuses for 54,000 retirees in the state Employees Retirement System. Those retirees haven’t seen regular cost-of-living increases.
Kemp also got the $115.7 million he requested to provide school security grants, or $50,000 a school. But lawmakers left out Kemp’s request to spend $25 million on learning loss grants to improve student achievement.
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