(The Center Square) — Georgia Gov. Brian Kemp signed legislation he touted as “the largest tax cut in Georgia history,” saying it will save the average Georgian hundreds of dollars on their state income taxes annually.
House Bill 1437 sets the state’s tax level at a flat 5.49% rate for the tax year beginning Jan. 1, 2024, which lowers to 4.99% for the tax year starting Jan. 1, 2029. The measure received broad bipartisan support in both chambers of the state legislature.
However, the state could delay the rate change if revenues lag.
“Georgia is leading the nation in the Great Recovery, and we are in a unique position to provide much-needed relief to hard-working taxpayers at a time when they are burdened with sky-high inflation caused by policies coming out of Washington, DC,” Kemp said before signing the bill during a ceremony in Bonaire.
“We can’t fix everything that Washington has broken, but we’re doing our part to lessen the pain on people’s wallets here in Georgia,” the governor added. “And today, we will put into place a more long-term system of relief, and I strongly believe that government should take in the very least amount possible needed to serve the people properly. We must never forget that taxpayer dollars are the people’s money; they’re not the government’s.”
Kemp said the change will save an average family of four in Georgia, making $60,000 annually, more than $600 per year on their state taxes.
Additionally, according to the National Federation of Independent Business (NFIB), the measure eliminates the standard deduction and increases the personal exemption from $2,700 to $12,000 for single filers and from $3,700 to $24,000 for taxpayers who are married and filing jointly.
“This couldn’t have come at a better time for Georgia’s small businesses,” NFIB State Director Nathan Humphrey said in a statement. “Skyrocketing inflation, a spike in fuel costs, and ongoing supply chain disruptions are putting tremendous financial pressures on Main Street businesses. HB 1437 is going to relieve some of that pressure by easing some of that pressure.
“HB 1437 is going to help small business owners because most small businesses in the state are organized as pass-through entities, meaning their owners pay state income taxes at the individual rather than the corporate rate,” Humphrey added.
By T.A. DeFeo | The Center Square contributor
