With a record state surplus expected, Abrams calls for $1 billion tax rebate

A day after state officials released revenue numbers pointing to a massive tax surplus, Democratic gubernatorial nominee Stacey Abrams called for a $1 billion taxpayer rebate.

Because her opponent, Gov. Brian Kemp, can’t unilaterally allocate surplus money for tax refunds without legislative approval, Abrams said she wants him to use federal COVID-19 relief money to give Georgians the rebate as soon as possible.

Under Georgia law, the governor decides how the $2.4 billion in COVID relief money the state recently received can be spent. However, federal officials have made it clear it can’t be used for tax cuts.

In an interview with The Atlanta Journal-Constitution, Abrams called on Kemp to negotiate with the Biden administration to allow the rebate using COVID relief money.

The General Assembly approved a similar $1.1 billion refund using state surplus money during the 2022 session.

Abrams said she would tailor the new rebates for Georgia households making less than $250,000 a year. That’s about 95% of income tax filers in the state.

The rebates under her proposal would amount to $500 for joint tax filers, $375 for heads of households and $250 for single tax filers.

”We need to plan for this now — and tell people to plan for it — because Georgia families continue to struggle,” Abrams said. “They need money in their pockets and roofs over their heads. And we need to absolutely invest to help them meet this moment.”

When Democrats in Congress passed the COVID relief plan last year, Kemp and other Republicans criticized them for including provisions banning the use of the money for tax cuts.

“If Brian Kemp cares about helping Georgia families deal with rising costs, he should work with our U.S. senators to investigate whether he can immediately use (COVID) funds to issue these relief checks to Georgians,” she said. “Unfortunately, throughout this crisis, he has criticized the financial help Democrats have provided and refused to work with the Biden administration to help hardworking families.”

Tate Mitchell, spokesman for Kemp’s campaign, responded: “To this point in the campaign, Stacey Abrams’ proposals have amounted to pie-in-the-sky hackery, tax hikes in poor disguise, pro-criminal policies or copycat proposals modeled after Gov. Kemp’s successful record of putting Georgians first and fulfilling his promises to the voters of our state.

“As he has done previously, Gov. Kemp will consult with legislative leadership and state budget officials to determine the best way forward for both the state’s surplus funds and federal coronavirus relief dollars — and he won’t be asking for Joe Biden’s permission.”

The state announced Friday that it ended the fiscal year on June 30 having taken in about 23% — or $6.19 billion — more in revenue than in a then-record fiscal 2021. A day earlier, the AJC reported the state had received the second half of the $4.8 billion it was expected to receive in COVID relief money from the federal government.

Kemp has spent a large chunk of the first half of the federal money on grants for water and sewer improvements, for high-speed internet projects, on money to help businesses and nonprofits better recover from the economic impact of the COVID pandemic, and for bonuses for law enforcement officers, firefighters and other first responders.

Kemp has already suspended the state fuels tax to reduce gas prices, and he is making up the loss of revenue with some of the leftover state surplus money from last year. Abrams has called on the governor to commit to extending the gas tax break through the end of the year.

How big the state surplus will be for fiscal 2022 won’t be determined until all the bills are paid, but it is expected to again be a record amount, likely over $5 billion. Kemp was already expected to call for some kind of tax rebate of the surplus, but that couldn’t occur until early next year because the General Assembly doesn’t meet again until January.

Abrams has said if elected, she will spend some of the most recent surplus to give raises to teachers and law enforcement officers and pay for an expansion of Medicaid, the health program for the poor and disabled, to cover more people.

She’s also planning on a slate of new proposals to address affordable housing issues and supply shortages.

”The governor has done nothing to stave off the housing crisis, and these are dollars that can be immediately put to use,” Abrams said. “We can do everything I listed without raising taxes.

”We have the resources to do what’s right for Georgia. This isn’t about whether we have the money. This is about doing what’s right.”