Lawmakers in the Georgia State Senate approved a cap on the state income tax late last month. If their measure is approved by the House and approved by voters there will be no further increases in the state income tax beyond the current rate of six percent. The measure is a proposed constitutional amendment, which means that once in place it would be very hard to reverse.

Experts say that it is unlikely that the constitutional amendment will be successful for a variety of reasons, including a procedural issue that requires revenue-related bills to start in the House of Representatives. The senator who sponsored the measure said that he intended to start a conversation about keeping Georgia as a low income tax state.

Taxes are being looked at among other things as a contributor or potential solution to the tough economic times facing the state. In general the idea of capping the income tax is somewhat controversial, as are any proposals to dramatically change state tax law. As such, there may not be any major overhaul of the state tax code this year as a number of other challenges facing the state could take priority.

However, these issues are important to keep track of since Georgia taxpayers should be aware of how any changes would impact them. In the case of capping the income tax the benefit to individuals is obvious since it will keep more cash in the pockets of residents. On the other hand, the state must maintain a workable budget in order to continue to provide necessary service and income taxes are a major part of bringing in enough revenue to maintain the budget.

Source: Atlanta Journal Constitution, “Georgia Senate passes proposal to cap the state’s income tax,” Kristina Torres, Feb. 24, 2014