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Kids Count Tour Budget and Taxes

Kids Count Tour Budget and Taxes. Alan Essig, Executive Director Georgia Budget and Policy Institute October 17, 2006. Taxes and the Budget.

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Kids Count Tour Budget and Taxes

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  1. Kids Count TourBudget and Taxes Alan Essig, Executive Director Georgia Budget and Policy Institute October 17, 2006

  2. Taxes and the Budget Over 75% of the state budget is spent on education, healthcare, and criminal justice. These three areas drive the state budget and are increasing both in cost and population faster than overall inflation and population growth.

  3. Existing and Emerging Needs • Georgia is the 9th largest and 5th fastest growing state. • Populations served by state government programs are growing faster than overall population. • Overall population growth 1990-2005 = 39% • Medicaid population growth 1990-2005 = 126% • Prison population growth 1990-2005 = 153% • There are existing education, healthcare, transportation, and other service demands, as well as the emerging needs of our growing population.

  4. Linking Taxes and the Budget Georgia needs a tax system that fairly raises sufficient revenues to meet the education, healthcare, criminal justice, environmental, and transportation needs of a modern, growing 21st century state.

  5. Adequacy of Funds • Georgians are paying less in state taxes as a percent of income.

  6. Fairness of Tax System • Georgia has a regressive tax system.

  7. Budget Outlook For FY 2008 • 5% to 7% revenue increase equals $935 million to $1.3 Billion. Education (formula growth) $333 Million Salary Increase (3%) $270 Million Medicaid and Peachcare $336 Million State Health Benefit Plan $215 Million Corrections $ 77 Million $1.23 Billion

  8. Budget Outlook FY 2008 and Beyond • Continued Federal Budget Cuts • Continued Population Growth and Demographic Changes • Education • Healthcare • Transportation • Actual and Potential Lawsuits • School Funding • Child Welfare

  9. Tax Cut Culture But at What Cost? • Potential tax cuts • Property tax caps • Eliminate ad valorem tax on cars • Eliminate or further reduce corporate income tax • Eliminate income tax on seniors • Additional sales tax exemptions • TABOR – Limits on growth of state and local revenue growth • House and Senate Study committees

  10. Policy Solutions • Commission for a New Georgia • Update business practices • Efficiency and effectiveness • Budget and Management Reform • Program budgeting • Transparency and High Performance

  11. Policy Solutions • Comprehensive Tax Reform and Modernization • Solidify tax base (Relevant to 21st century economy) • Raise sufficient revenues • Withstand downturns • Fair and equitable state tax system • Targeted tax cuts

  12. Example A:Comprehensive Tax Reform

  13. Example B:Comprehensive Tax Reform

  14. Contact Info Alan Essig 100 Edgewood Ave Suite 1040 Atlanta, GA 30303 404-420-1324 www.GBPI.org

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