The Atlanta Journal-Constitution
Published on: 03/17/08
Finally, a fiscal conservative has spoken: Gov. Sonny Perdue has correctly characterized House Speaker Glenn Richardson's plan to end car tag taxes as "irresponsible."
The legislation, which would go to voters as a proposed constitutional amendment, passed the House Tuesday with overwhelming bipartisan support. Since constitutional amendments don't require the governor's signature, it's up to the Senate to stop the measure, which would end up costing the state more than $750 million a year.
The proposal comes at the worst possible time, with each day bringing economic news more grim than the day before. With the nation almost certainly in a recession, state revenues are likely to plunge in coming months, and a huge tax cut would surely compound the damage to the budget.
"This is like creating for ourselves the situation I found when I came into office ... $600 million, $700 million in the hole," the governor pointed out. Only it's likely to be a lot worse than that.
Supporters of the tax cut claim that it will magically create growth that multiplies tax revenues. That's classic voodoo economics. Some tax cuts, such as trimming the tax on capital gains, may in fact spur investment. But cutting the car tax only denies the state funds for critical services such as health care, education and prisons. (While the automobile ad valorem tax is collected by counties, the state has pledged to make up the revenue that counties lose.)
Indeed, the best way to guarantee economic growth is to provide a healthy, well-educated work force. Georgia already has one of the lowest tax burdens in the country, but that's not the ranking that most concerns business executives. They'd prefer a low dropout rate. They'd rather go to a region with high math and reading scores, with roads that work.
In an election year, the Senate will come under immense pressure to pander with this measure, but its members would do well to resist. A huge tax cut will surely come back to haunt them if they have to tell voters that their child's teacher has to be laid off because of a shortfall in the treasury.
—- Cynthia Tucker, for the editorial board (cynthia@ajc.com)



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