The Tax Foundation

Research Areas

Georgia

The Facts on Georgia's Tax Climate

Here are some basic facts on Georgia's tax system and how it compares to other states:

Tax Freedom Day Arrives on April 19 in Georgia
Tax Freedom Day is the day when Americans finally have earned enough money to pay off their total tax bill for the year. In 2008, Georgia taxpayers had to work until April 19 to pay their total tax bill, ranking them 23rd nationally. That's four days earlier than national Tax Freedom Day (April 23). The Tax Freedom Days of neighboring states are: Tennessee, April 11 (ranked 44th nationally); Alabama, April 9 (ranked 46th nationally); Florida, April 26 (ranked 9th nationally); South Carolina, April 16 (ranked 33rd nationally); and North Carolina, April 17 (ranked 27th nationally).

Tax Freedom Day has been projected using the most up-to-date economic and budget projections from official government agencies. However, Tax Foundation estimates of average state and local tax rates for 2008 will not be released until later this spring as we await more up-to-date data from various government agencies.
Full study of Tax Freedom Day, nationwide and in each state

Georgia's State/Local Tax Burden Slightly Above National Average
Estimated at 9.9% of income, Georgia's state/local tax burden percentage ranks 16th highest, slightly above the national average of 9.7%. Georgia taxpayers pay $3,735 per capita in state and local taxes.  Since 1977, Georgia has risen 20 places in the rankings.
Georgia's State-Local Tax Burden, 1977-present
Other States' State/Local Tax Burdens
Historical Chart Comparing All States' State/Local Tax Burdens from 1977 to 2008

Georgia's 2008 Business Tax Climate Ranks 20th
Georgia ranks 20th in the Tax Foundation's State Business Tax Climate Index. The Index compares the states in five areas of taxation that impact business: corporate taxes; individual income taxes; sales taxes; unemployment insurance taxes; and taxes on property, including residential and commercial property. Neighboring states ranked as follows: Tennessee (16th), Alabama (21st), Florida (5th), South Carolina (26th) and North Carolina (40th).
50-State Comparison of Business Tax Climates (data only)
2008 State Business Tax Climate Index, Fifth Edition (full study)

Georgia's Individual Income Tax System
Georgia's personal income tax system consists of six separate brackets with a top rate of 6% kicking in at an income level of $7,000. That top rate ranks 22nd highest among states levying an individual income tax. In 2005, individual income tax collections were $802 per person, which ranked 21st highest nationally.
50-State Table of Individual Income Tax Rates
50-State Table of State Individual Income Tax Collections
50-State Table of State and Local Individual Income Tax Collections Per Capita

Georgia's Corporate Income Tax System
Georgia's corporate tax structure consists of a flat rate of 6% on all corporate income. Among states levying corporate income taxes, Georgia's top rate ranks 36th highest nationally. In 2006, state-level corporate tax collections (excluding local taxes) were $95.12 per capita, ranked 42nd highest nationally.
50-State Table of Corporate Income Tax Rates, 2000-2008
50-State Table of State and Local Corporate Income Tax Collections Per Capita and Per Household, 2005
50-State Table of State Corporate Income Tax Collections Per Capita, 2006

Georgia Levies Sales Tax below National Median
Georgia levies a 4% general sales or use tax on consumers, below the national median of 5.4%. In 2005, state and local governments combined collected $1,113 per person in general sales taxes, which ranked 33rd nationally. Georgia's gasoline tax stands at 26 cents per gallon, which is 19th highest in the nation. However, the state's general sales tax is applied to purchases of gasoline, and localities are allowed to levy "local option" sales taxes on gasoline. Georgia's cigarette tax stands at 37 cents per pack of twenty, which ranks 42nd nationally. The sales tax was adopted in 1951, the gasoline tax in 1921 and the cigarette tax in 1937.
50-State Table of Sales and Excise Tax Rates
50-State Table of State and Local General Sales and Gross Receipts Tax Collections Per Household and Per Capita, Fiscal Year 2005

Georgia Property Taxes: Comparatively Modest
Georgia is one of the 37 states that collect property taxes at both the state and local levels. As in most states, local governments collect far more. Georgia's localities collected $7,779,708,000 in property taxes in fiscal year 2004, the latest year for which the Census Bureau has published state-by-state data. At the state level, Georgia collected $65,118,000 in property taxes during FY 2004, making its combined state/local property taxes $7,844,826,000. That brings its per capita collection to $880 (ranked 34th nationally).
State property tax collections per capita by state

Federal Tax Burdens and Expenditures: Georgia is a Beneficiary State
Georgia taxpayers receive about the same federal funding per dollar of federal taxes paid compared to the average state. For every dollar of federal tax collected in 2005, Georgia citizens received approximately $1.01 in federal spending. This ranks the state 32nd nationally and represents a slight increase from 1995 when Georgia received $.96 per dollar of taxes in federal spending (then ranking it at 33rd highest). Neighboring states and the amount of federal spending they received per dollar of federal taxation were as follows: Tennessee ($1.27), Alabama ($1.66), Florida ($.97), South Carolina ($1.35), and North Carolina ($1.08).
Comparing the amount of federal taxes sent to Washington with the amount of federal spending coming back to the state

Articles from the Tax Foundation