Recent tax stories

Major tax cuts are in the air, but it may be 2008 before lawmakers do more than talk about them.

House leaders are talking up the idea of eliminating state income taxes, a favorite issue among Republicans. But the price-tag -- about $9 billion -- isn't doable without raising taxes in some other areas or eliminating sales tax exemptions much-prized by businesses and shoppers.

Senators don't think the state can afford a major tax cut this year, but they'll almost certainly push for Gov. Sonny Perdue's proposal to eliminate retirement income taxes on well-to-do retirees. The change, which would, for instance, affect retired couples if their income is more than about $90,000 to $100,000 a year, would cost the state about $142 million. With Perdue's easy re-election win in November, lawmakers are likely to fulfill one of the few promises he made to voters.

Slower revenue growth this year -- combined with rising school and health care costs -- means there won't be any new big-ticket programs this year. Perdue is likely to stick to his policy of spending what's needed, socking away money in reserves, and borrowing heavily to build more schools, college facilities and roads.

-- James Salzer