Wednesday, October 29, 2014

Two tax measures on Georgia’s ballot


Tuesday’s election will include two ballot questions related to taxes in Georgia.

The first is a proposed constitutional amendment that would limit Georgia’s top marginal income tax rate to 6 percent. The tax rate has been steady at 6 percent since 1969 by statute, but this change would enshrine the rate in the state constitution. Supporters say the amendment would help attract businesses to Georgia by giving them additional confidence that the tax rate would not increase, while opponents say the cap would restrict Georgia’s ability to increase revenues if needed. The wording of the question is “Shall the Constitution of Georgia be amended to prohibit the General Assembly from increasing the maximum state income tax rate?”

The second tax question is a statewide referendum that would clarify that state university-owned student housing and parking decks leased and managed by private contractors would always retain tax-exempt status. Government property is almost always tax-exempt. The question reads, “Shall property owned by the University System of Georgia and utilized by providers of college and university student housing and other facilities continue to be exempt from taxation to keep costs affordable?” The Georgia Policy and Budget Institute’s Wesley Tharpe laid out the pros and cons of this proposal to The Marietta Daily Journal, saying:
"(The proposal will) allow Regents to reduce the nearly $4 billion in debt that it has accrued over time as a result of what some have described as overbuilding,” Tharpe said. “This could help free up the university to sell additional bonds at a better rate for other projects in the future. “The potential downside is that there are no restrictions explicitly spelled out in the legislation as to how much private companies will be able to charge for rent,” he continued. “The university system claims that it will still have the ability to regulate and limit student housing costs over time, but it is still somewhat of an open question since those rules are not laid out in the proposal."

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