(The Center Square) – A bill that would expand taxpayer savings on education in state has been approved by the Georgia House and is headed to the Senate.
House Bill 517 raises the cap on the state’s tax credit scholarship program and the amount in tax incentives those who donate to the program can get.
“What this does is going to increase school choice in Georgia,” said Rep. John Carson, R-Marietta, the lead sponsor of the bill.
The Georgia Qualified Education Expense Tax Credit allows taxpayers to get a tax credit for donating money to nonprofit student scholarship organizations for K-12 students to attend a private school of their parent’s choice.
HB 517 would increase the tax credit from $1,000 to $2,500 for a single filer or head of household, from $2,500 to $5,000 for a married couple filing a joint return and from $10,00 to $25,000 or the amount expended for a business, whichever is less. The measure would raise the current $100 million cap on the program by $20 million each year through 2032.
Rep. Josh McLaurin, D-Sandy Springs, pointed to concerns over possible misuse of funds by schools in the program. A January 2021 state audit of the program recommended lawmakers improve transparency and accountability in the program, including developing a process to review credits.
The measure requires interest earned on deposits and investments from scholarship donations be rolled back into the scholarship fund. It also requires schools and organizations in the program to complete and submit an audit to the Georgia Department of Revenue six months after each fiscal year.
Carson said the program had been fully subscribed to for the past 10 years except for 2020 because of COVID-19. According to EdChoice, Georgia issued 16,193 scholarships in 2020 through the program, with the average scholarship totaling $4,464.
The scholarships can save taxpayers money, according to EdChoice. The scholarships in 2020 were equal to 40% of public school per-student spending. Each taxpayer saved money on the sum they would have paid in taxes for each student enrolled in the program to attend public schools. A November report by EdChoice found the program saved Georgia taxpayers $1.1 billion in fiscal 2018.
HB 517 was approved by both chambers of the General Assembly last legislative session, but an amended version of the bill did not make it back to the House before the end of the session. The Senate requested 5% of the tax credits be set aside for insurance premiums tax. The bill now heads back to the Senate for consideration.
