Tax reform — Pass or fail?

Tax reform — Most every candidate running for state office has talked about some form of it. Finally after years of talking about it, it appears that the Georgia General Assembly will deal with tax reform next year.

I have long supported tax reform. Since my first session, I have introduced and supported bills to reform our state’s tax structure. Now, the Speaker of the House has proposed his reform, the GREAT plan.

On the surface, it sounds really good. It would eliminate every ad valorem tax and replace it with a combination of a consumption tax on all goods and services and some restructuring of income taxes. Since I hate property taxes and feel they are the most unfair tax of all, I took a serious look at the Speaker’s plan.

Since I have worked on tax reform bills, I had already established some basic principles to govern the process. Remember the saying, “If you don’t know where you are going, any road will get you there”?

Well, by establishing basic principles you will know where you are going and will know when you get there. Basic principles also help to keep personalities and politics out of the equation.

For me, basic principles of tax reform are: 1. It should be fair; 2. It should be simple; 3. It should be easy to comply with; 4. It should be transparent; and 5. It should comply with other basic principles.

Let’s consider the Speaker’s plan according to my reform principles. Is it fair?

Well, it would shift tax collections based upon spending, rather than property. That sounds good. But, looking closer, the plan would eliminate current exemptions on food and is unclear on other items like housing and medical. So, as far as being fair, it doesn’t yet pass.

Is it simple? It is unclear on exactly what would be taxed. Also, Atlanta would be collecting all taxes and then somehow allocating back to local governments based upon some formula. For me, it doesn’t pass the simplicity test.

Is it easy to comply with? Currently you pay your tax bill either through your escrow account or by writing a check at this time of year. The plan would shift to paying a tax when you buy a good or service. I don’t see any violation of this principle, but I don’t really see much improvement either.

Is it transparent? The GREAT plan would eliminate the property tax assessment fog that currently exists. Few people understand the process. It is easier to see a set rate per dollar than what businesses have to add to their purchase prices to cover their property taxes.

However, the details of the plan have not been totally worked out and word is the plan will include some sort of business to business transactional tax. If so, that would cause it to fail this principle.

Finally, does it comply with other basic principles? Frankly, to me it fails this principle the most.

The plan would have all taxes collected in Atlanta and then be allocated back to local governments based upon some formula. Most politicians ran on platforms against unfunded mandates and supporting local control. This plan would greatly weaken local control.

If your school system wanted to hire more teachers, or if your county wanted to hire more sheriff deputies, or if your fire department wanted a new station or new firefighters, they would have to go to the General Assembly and beg for them. As it is now, they have to ask their constituents for them.

If constituents’ expectations aren’t met, they can vote their local elected officials out of office. With the Speaker’s plan, local residents will not be able to have the same level of influence. They would trade voting for one out of five members of the county commission or three out of seven members of the school board for voting for two out of 236 members of the General Assembly.

Their influence over local matters would be greatly diminished. And to me, I want to increase the influence of citizens over government, not weaken it.

I am glad to see that tax reform is finally a serious topic under the gold dome. I appreciate the Speaker’s effort at a bold tax reform plan.

The beginning of session is two months away. There is still time to create a reform plan that meets sound principles for reform. I look forward to working with him and others to develop that tax reform plan.

[Senator Mitch Seabaugh, R-District 28, Sharpsburg, is the Senate Majority Whip.]

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JGF9148's picture
Submitted by JGF9148 on Thu, 11/08/2007 - 12:05pm.

What's wrong with you people? Don't you know Mitch only has the interests of PTC at heart? Has he not demostrated that to you by supporting PTC'S best Mayor ever and his undying support of the TDK Autobahn? He isn't beholding to any special interests, he's the peoples senator.


Submitted by Doug on Wed, 11/07/2007 - 8:54pm.

Thank God for Steve Brown or the stinking road would have been built by now. Notice Steve being called the "unwilling partner" and at the end saying he just wouldn't cooperate to get the road from hell built.

Project funding remains in limbo
Published 12/15/04

By SARAH FAY CAMPBELL

sarah@newnan.com

Is Peachtree City Mayor Steve Brown sending a message to the residents of Coweta County?

State Sen. Mitch Seabaugh thinks he might be, after a meeting of all the parties involved in the extension of TDK Boulevard to Coweta County produced no results.

"Basically everybody put it on the line that they were willing to partner, but there was one unwilling partner, who was unwilling to work for solutions for this road -- and that was the mayor of Peachtree City," said State Sen. Mitch Seabaugh, who organized the meeting.

And with Brown's stand, Seabaugh poses this question -- "Is the mayor trying to send a message that he doesn't want people in Coweta County shopping in his shops, eating in his restaurants, or working in his businesses?"

At the meeting held Tuesday, Commission Chairman Vernon "Mutt" Hunter and Commissioner-elect Tim Higgins represented Coweta. Also on hand were Greg Dunn of the Fayette Commission, Congressman-elect Lynn Westmoreland, representatives from the Federal Aviation Administration and Peachtree City's Falcon Field, Brown, and PTC City Administrator Bernie McMullen.

"There were a lot of ideas floated, a lot of positions stated," said Hunter. "It became apparent that everybody was in one accord, except in one instance."

But the meeting wasn't a total loss.

"Several of us got some things off our chest. Maybe it will be better now," Hunter said. "I think that meeting and talking did some good -- I'm talking about direct talking."

"I felt like we made a lot of progress," Seabaugh said. "We just couldn't push it over the goal line."

The sticking point at the moment is over the funding for the redesign of the road. Part of the road was changed to get it out of the safety zone for Falcon Field. Fayette County says Peachtree City should pay, and Brown says his city is not paying anymore money and the county ought to pay it. Neither seems close to budging.

The airport actually owns the property in the safety zone, said Seabaugh.

"The FAA right now is trying to do what they can to correct situations of cars in the flight safety zone," Seabaugh said. "If they're spending a lot of money trying to correct it, why would they allow that somewhere, when they're trying to correct it?"

About a year ago, when Brown first brought up the issue of problems with the airport, he told several newspapers that the airport would lose all federal funding if the road were built in the safety zone.

The folks from the FAA "confirmed that was absolutely incorrect," Seabaugh said.

Nobody was asking for monetary commitments or anything like that at the meeting, Seabaugh said.

"Everybody was willing to keep walking down the road and keep working together. We asked the question if the mayor would be a part of partnering," Seabaugh said.

"Nobody put any requirements, commitments or anything, just the willingness to work together. All anybody asked from the mayor was to partner with everybody to work for viable solutions, so we could explore all possible solutions and viable resources, in order to build that road," he said.

"Nobody asked the mayor to commit to anything but cooperation and working with everybody. But he wouldn't."

There was a sense of frustration, Seabaugh said. But he found it encouraging that there were some people at the meeting who had traded barbs with each other in the press, but that did not hinder cooperation among the group, Seabaugh said.

Spear Road Guy's picture
Submitted by Spear Road Guy on Thu, 11/08/2007 - 6:30am.

When you read stuff like, "Nobody asked the mayor to commit to anything but cooperation and working with everybody. But he wouldn't," it's hard to figure out why McDonoughDawg and Birdman keep ragging on Steve Brown saying he supported TDK. From Seabaugh's comment it was obvious Brown was against the thing.

I got swept up in all the hysteria from the developer sponsored crowd about Brown being against traffic solutions. I was stupid enough to believe them.

Supposedly, Sen. Seabaugh works for a Coweta developer.

Vote Republican


Submitted by Nitpickers on Fri, 11/09/2007 - 8:11am.

Who fought paying nearly two million for a Tennis Center and it's "Pros" and then who said, yes---pay it?
Paying it wasn't the worst part of it---building it and staffing it with money grubbers and then covering it up as long as possible was the worst!
I think Brown did number one, and Logston number two!
Yapping about what people want to hear and doing something useful for citizens is two entirely different things!
I can't argue the one about the Lutherans wanting a department store (and several millions)at 54/Parkway. I don't know why Brown said it was ok with him.
Maybe it could now be jammed in at West Peachtree City?

Submitted by Jones on Fri, 11/09/2007 - 9:41am.

Nitpickers are you saying Steve Brown was responsible for Bob Lenox's antics with the development authority?

Construction on the tennis center began before Brown took office, so what are you talking about? We all know Logsdon paid the guys off, but blaming Brown who battled the disaster for four years is a bit crazy.

I have to agree with the other bloggers that every one in favor of TDK said Brown was trying to kill the road.

Submitted by Nitpickers on Fri, 11/09/2007 - 10:12am.

I said Brown fought it!

Submitted by McDonoughDawg on Thu, 11/08/2007 - 12:15pm.

They are verifiable on this very website. Fact is at one point he was for TDK (which he seems to totally deny), and he was for changing zoning at a major corner of town for 24 hour drug stores. Those are my beefs, and if they bother you, so be it.

I've also said that maybe he has changed. A word from him on a few subjects would put much if not all of it to rest. I'm not the only one who feels this way RE Brown. Why else to you think he got SMOKED in the last Mayors election?

Spear Road Guy's picture
Submitted by Spear Road Guy on Thu, 11/08/2007 - 10:04pm.

Reasonably speaking, if all of Brown's political enemies (Seabaugh, Bob Lenox, the Direct PAC crowd, Greg Dunn and the Coweta Commissioners) swore in the newspapers that Brown was blocking TDK, don't you think he was actually putting the brakes on the thing? Seriously, why wasn't the road built while he was in office?

Steve Brown got "smoked" because a lot us (I include myself in this) were dumb enough buy the developers and Logsdon's lies. The people in my area think he's a hero now. I admit he was right on a lot of stuff, not all of it, but a lot of it.

Vote Republican


Submitted by johenry on Thu, 11/08/2007 - 11:07am.

There's no "supposedly" about it, Senator Sea-screw the citizen-baugh is employed by a residential housing developer. And stop worrying about McDonoughdawg. He justs hates Brown for no good reason.

McDonoughdawg is still defending his boy Logsdon. Pathetic.

Submitted by McDonoughDawg on Thu, 11/08/2007 - 12:16pm.

Calling Brown up on his votes and support of certain things in NO WAY has anything to do with defending Logsdon.

Submitted by d.smith700 on Wed, 11/07/2007 - 2:38pm.

Well, obviously if our state taxes need reform it means they are currently incorrect or wrong for some of us!
Now I think both of these politicians are republican--they have to be.
I think most of the tax money currently collected on property comes from people's homes, paid for or not, and on business people's inventory, which usually mostly disappears between December 31 and January 2!
I'm not going to get into the business inventory stuff as it is really complicated--just one example: a jeweler on December 31 physically takes his inventory to Tennessee for a couple of days, and goes and gets it on January 2. Law says: tax is on inventory in place in Georgia on January 1. Enough said about that.
Now as to people's homes: do the math on people with $100,000 homes, $200,000 homes, $500,000 homes,$1,000,000 homes, and above.
At about $300,000 homes the owner will spend about as much on taxes (sales) as he previously paid for property taxes.
At a million dollars the owner will save $5,000. And so forth!
Now who will pay the $5,000 savings for the expensive homeowners under the "tax reform?" Those with homes under a million all the way down to $300,000, that is who.
A wealthy person can only eat so much better than the average person; he can buy more, and more expensive, jewelry; he can travel more; etc., but I figured reasonable numbers in for that sort of thing!
Anybody want to guess how about 13% sales tax instead of 7% will affect the poor and lower middle wage earners?
Do grocery stores, doctors, services, etc., charge them less to make up for the added sales tax? No!
What if the Feds do the same thing instead of income taxes?
Now we will have 13% plus 30% federal tax on sales on nearly everything!
Wow! $4.50 gas might be $6.00 per gallon. $100 worth of groceries could be $145.00. Five dollar Starbucks= $7.50. Local Bonds for schools, libraries, etc., will still be paid by locals as usual!
OK, so exceptions will be made---who will get them?
What this sounds like to me is sending spending authority to the state instead of to the city and counties, and perpetuating the civil jobs paid with tax dollars!
We ain't got nobody smart enough to even do this right.

nuk's picture
Submitted by nuk on Thu, 11/08/2007 - 11:28pm.

Seabaugh is writing AGAINST Richardson's "GREAT" idea, an idea that is so not-great that fellow Repub Perdue has come out strongly against it as has Lt. Gov. Cagle. It ain't going to pass, thankfully.


Submitted by new2ptc on Wed, 11/07/2007 - 4:01pm.

The other question is what are the exemptions? My guess would be similar to the Consumer Tax (aka Fair Tax). With the Consumer Tax investment purchases such as stocks are exempt hence the name Consumer Tax.

mapleleaf's picture
Submitted by mapleleaf on Wed, 11/07/2007 - 1:24pm.

Don't businesses now pay property tax on office buildings and stores, large and small?

Won't the plan to abolish property taxes lift their burden completely?

What will businesses pay sales and service tax on? What does a bank or a store consume?

Won't it be the little people who'll end up paying the great bulk of the sales and service tax?

Who's really behind the GREAT plan? Business?


Submitted by Nitpickers on Fri, 11/09/2007 - 8:18am.

Of course they will make out like bandits with the proposed huge sales tax!
It is just one more item to screw citizens and benefit corporations and large landholders. Big contributors to republicans--in other words.
It isn't hard to see through the current polarized differences between republicans and democrats in all areas----ot is who shares the MONEY!

Submitted by Jones on Tue, 11/06/2007 - 8:14pm.

so why does this guy Seabaugh keep writing in Fayette County instead of Coweta County?

Sniffles's picture
Submitted by Sniffles on Wed, 11/07/2007 - 7:54am.

Senator Seabaugh technically is representing Coweta county, but he recognizes that the real money to be made is in Fayette.

That's why he bankrolled literally 20% of Harold Logsdon's campaign warchest, and Logsdon in return is greasin' the skids for the TDK road.


Voice of Fayette Future's picture
Submitted by Voice of Fayett... on Wed, 11/07/2007 - 8:40am.

(a) He works for a developer and they need Fayette
(b) He MUST get TDK finished into Coweta
(C) When Congressman Lynn Westmoreland (also a developer from Coweta) runs for Governor, Seabaugh will be licking his chops for Congress. By then, the ignorant voters of Fayette will forget that it was Mitch that installed TDK Blvd.


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