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State panel to back lower income tax

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POSTED: January 6, 2011 9:14 a.m.

ATLANTA (AP) - The head of a panel weighing an overhaul of Georgia's tax code said Wednesday the group will likely recommend lowering the state's personal and corporate income tax rates and instead taxing more goods and services.

But A.D. Frazier declined to provide specifics, saying the details would be laid out in a report to be presented on Monday to Lieutenant Gov. Casey Cagle and House Speaker David Ralston.

"We're not quite there," Frazier said at a meeting of the 11-member panel.

Frazier said Wednesday's meeting might not be the council's last one. He was unsure if another meeting is needed to finalize recommendations. Many of the panel's discussions have been conducted away from the public eye in private sessions, and Frazier said Wednesday he was not sure if council members would ultimately vote on the final recommendations.

Frazier said the panel's recommendations will be more far-reaching than originally anticipated. The final report - once expected to be 10 pages - will now stretch to about 50 pages, he said.

He said the group expects to suggest changes to most types of taxes that the state collects, from income and corporate taxes to those levied on cigarettes and motor fuel.

He said the proposals, taken together, would "come as close to being revenue neutral as we could."

One of the biggest questions is whether the state will slap the state sales tax back on groceries, which could bring in about $600 million a year to the cash-strapped state.

It would be a tough sell in the Republican-led state Legislature, where many members have pledged not to raise taxes.

"I'm not going to say the 'g' word today," Frazier told reporters following the meeting.

The council was created by legislators during last year's legislative session to consider a wide-ranging overhaul to the state's tax code. Any changes would need to be approved by the state Legislature and signed by the incoming governor, Republican Nathan Deal.

Deal pledged during his campaign to reduce the corporate income tax. He opposes applying the state sales tax to groceries but also said he would have to seriously consider any tax bill that passed the legislature.

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Special Council on Tax Reform and Fairness for Georgians: http://fiscalresearch.gsu.edu/taxcouncil

 

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