Opportunity is knocking as the door opens on Georgia’s 2017-18 legislative session. In a state with a Republican governor since 2002 and GOP majorities in both chambers since 2004, it’s time for legislators to welcome policy reforms that can improve income, opportunity and well-being.
In 2014, the Legislature capped the personal income tax rate at 6 percent. That’s a start. But legislators ignored a provision in the 2015 Transportation Funding Act (HB 170) to create a “Special Joint Committee on Georgia Revenue Structure” that would “during the 2016 legislative session cause to be introduced in the House of Representatives one or more bills or resolutions relating to tax reform.”
Reforming Georgia’s individual income tax rate was on the table long before the stellar 2010 work by the special tax reform council (shelved since). Meanwhile, North Carolina’s rate ratcheted down, reaching 4.75 percent this year, and Florida has no personal income tax rate. Tennessee does not tax wages and salaries and phases out taxes on dividends and interest by 2022.
How much difference would tax reforms make? The Georgia Department of Labor reports 99.8 percent of Georgia’s nearly 300,000 employers are small businesses; 77.7 percent with fewer than 10 employees. The Tax Foundation reports 94 percent of businesses are “pass-through,” filing individual instead of corporate tax returns
Instead of seeking competitive advantage by picking winners and losers through tax breaks and incentives, how about embracing a lower rate and a broader base? That’s pro-growth and fair to Georgia’s hardworking taxpayers. Businesses could add equipment and workers; employees could control more family income.
Without an educated workforce, opportunity lags and the economy suffers. Unfortunately, the November referendum on a statewide Opportunity School District for “chronically failing” K-12 schools failed. Parents of the 68,000 children trapped in those schools deserve results. Low-income families, who have few options, deserve the respect of a choice to give their children a chance.
In 2015, the Governor’s Education Reform Commission proposed a funding formula focused more on student achievement so schools would not be required to spend funds on items that do not appear to boost student learning. With such “student-based budgeting,” more money follows the child, with greater accountability.
Georgians already demonstrate their support of school choice: The tuition tax credit scholarship fund reaches its $58 million cap on voluntary contributions on Day 1 each year. It’s a small step to enhance choice by simply raising that cap.
Education Savings Accounts empower parents to personalize their child’s learning. Operating in five states including Florida and Tennessee, ESAs can fund a variety of authorized education services through a debit card using the child’s public education funds.
When it comes to Georgians’ well-being, legislators need not wait on Congress to improve health care access and affordability. First, facilitate direct primary care, which operates much like a gym membership: low monthly premiums, unlimited use and hefty discounts on many procedures. Physicians need assurance this high-quality, low-cost approach will not be regulated as insurance.
Next, reduce protectionist scope-of-practice restrictions and eliminate costly, unnecessary licensing requirements for health care professionals; end certificate-of-need requirements for health care facilities and increase staff by streamlining occupational licensing.
Finally, seek reimbursement for the unfunded federal mandate requiring hospitals to treat all ER patients regardless of ability to pay. A block grant could fund uncompensated care and allow Georgia to take the lead in fast-tracking customized, affordable coverage for the estimated 565,000 uninsured low-income Georgians.
Other states have done much of this, but Georgia now, especially, has a vested interest in leading the nation on health care reform.
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Benita M. Dodd is vice president of The Georgia Public Policy Foundation.