New Podcast on State Tax Reform with Prof. Christine Ries
January 20, 2011
This week’s Tax Policy Podcast features an interview with Prof. Christine Ries of Georgia Tech, in which she describes her recent experience serving as a member of Georgia’s Special Council on Tax Reform and Fairness. The council recently completed its deliberations and presented state lawmakers with a list of recommendations, including eliminating special exemptions and credits, lowering income tax rates and broadening the base of the sales tax.
A bipartisan tax commission chartered last year by the legislature is proposing that Georgia cut its personal and corporate tax rates by a third, to a flat 4% from a high of 6%. “Our overriding goal was to get the income tax rate as low as possible, because the evidence is so clear that this is the biggest driver of growth and jobs,” says commission member Christine Ries, an economist at Georgia Tech. The plan is a “revenue neutral” shift to a cleaner and simpler state tax code.
The plan follows the first principle of a sound and fair tax system: Apply a low rate to a broad base. The most controversial change is the grocery tax, which liberal critics call a regressive levy on the poor. In fact, the proposal would increase the personal exemption to offset the food tax for low-income families.
Georgia, of course, isn’t the only state considering large-scale tax reform (Vermont, for example, has a similar state-chartered commission), though in her podcast interview Prof. Ries was skeptical that very many other states would end up embracing her state’s comprehensive approach. Given the growing parade of states that have announced reform plans and rate cuts, however, there are plenty of reasons to be optimistic about 2011 (unless you live in Illinois, of course).
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