Perdue, Cagle slam cutting property tax on cars


The Atlanta Journal-Constitution
Published on: 03/13/08

Both Gov. Sonny Perdue and Lt. Gov. Casey Cagle on Thursday ripped the House's passage this week of legislation that would eliminate property taxes on cars.

Perdue called the plan irresponsible. Cagle said it doesn't provide the economic relief Georgians need now.

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The measure, if approved by the Senate and then voters this fall, would wipe out car taxes over two years, eliminate the .25-mill state property tax on homes and place limits on property assessments.

In total, it would save Georgians about $750 million when fully implemented.

The plan passed the House with overwhelming bipartisan support, but the comments from Perdue and Cagle on Thursday indicate it may be in for a rough time in the Senate.

Perdue told reporters Thursday that he shares the concern of some critics who say the loss of that much revenue each year could devastate education and health care programs in a growing state.

"This is like creating for ourselves the situation I found when I came into office ... $600 million, $700 million in the hole," the governor said. "People love to vote for tax cuts. It's much tougher to balance a budget and talk about where the tax cuts come from.

"I think the people of Georgia get the joke. They want infrastructure, they want education and they want the government to work for them," he added. "I am very concerned that the level of these kind of things is irresponsible."

He called the House vote "pandering" to voters in an election year.

House Majority Leader Jerry Keen (R-St. Simons Island), defended the plan.

"We just have a philosophical difference of opinion with those who disagree and maybe call it pandering. This is a core Republican philosophy and principle that when you ... return tax dollars to the public, you grow tax revenue in the future."

House Republicans plan to wear "Axe the Birthday Tax" stickers to county GOP conventions this weekend to show support for the plan. The car tax has been dubbed the birthday tax because it is due on the birthday of a car's owner.

Cagle, president of the Senate, said Thursday that he objects to the tax cut plan approved by the House because it won't help Georgians now, when they need relief because of the sluggish economy.

"The House has passed a plan that needlessly delays tax relief for over a year, and doesn't provide the full amount of relief for two years," he said in a statement.

"Georgia workers are at risk of losing their jobs right now due to the economic downturn. Why are we waiting two years to cut taxes instead of having the courage to do it right now?

"I am interested in working with the House on a broad economic stimulus plan that will create jobs today."

House Rules Chairman Earl Ehrhart (R-Powder Springs) said Cagle's statement sounded like "he's auditioning for the Barack Hussein Obama ticket.

"If that man [Obama] is on the ballot, he and Casey are going to be right there on taxes."

Cagle's Senate has already passed the part of the plan that limits increases in property assessments.

However, Cagle has not voiced support for eliminating the car tax, and neither have other Senate leaders.

While House Democrats overwhelmingly backed the measure, Sen. Steve Thompson (D-Marietta) said he wants to know where the money would come from to pay for the tax cut before he supports it.

"I don't have a thing against taking the ad valorem tax off cars," Thompson said. "Just show me in the budget where we're going to cut before I say I am for it. If you're going to cut services for old folks and children, the answer is 'no.' "

Critics of the car tax cut gathered Thursday outside the Capitol to say the loss of so much revenue would mean trouble for state programs.

"How fair is it to provide tax relief to one group while asking our children to pay for it," said Karen Hallacy of the Georgia PTA. "We can't implement piecemeal tax cuts without the quality of our children's education also being cut. We are 49th [in education], how low do we want to go?"

House Republicans said the state had no financial problems in the late 1990s when it eliminated the state sales tax on groceries. That, they said, was a $500 million hit for a much smaller state budget, but overall revenue collections grew because of a strong economy. Perdue and Cagle, who were in the state Senate at the time, voted in favor of eliminating the grocery tax.

Alan Essig, executive director of the Georgia Budget and Policy Institute, said times were different when that tax cut was approved.

"It was in the middle of the largest economic boom we've ever seen," Essig said. "What we're doing now is taking a major tax cut over a much shorter period of time as we're heading into a recession."

Perdue also criticized the way the House put together the tax bill in a relatively short period of time.

"This is major tax policy in the state done on the fly," he said. "I kind of liken it to the Wright Brothers jumping off at Kitty Hawk and designing the airplane on the way down."

But House Speaker Pro-Tem Mark Burkhalter (R-Alpharetta), who has pushed eliminating the car tax for several years, said the tax cut is the right thing to do.

"It's real simple," he said. "When taxpayers overpay to the government and government has sufficient money to address all the critical needs of the state, then government ought to refund money to the taxpayers.

"This is a matter for voters to decide on the ballot in November. I am confident Georgians are smart enough to decide if they deserve a tax cut."




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