Georgia senators send Kemp $1B income tax refund package

Over the course of several months, the provisions would exempt tax collections on gasoline and diesel fuel to confirm Kemp’s choice and provide an additional $1 billion in tax refunds to income tax filers.

As part of the revised budget for this year, Kemp has already enacted his proposal for a $950 million rebate on property taxes, which was signed into law on Friday.

Both the income tax and property tax refunds were important promises made by Kemp during his successful reelection campaign last year.

The Senate voted 46-7 in favor of House Bill 162, which would provide a second consecutive year of income tax refunds.

Kemp is anticipated to sign the bill, which is set to provide a reimbursement of $250 for individuals filing as single, $375 for single adults who are heads of households with dependents, and $500 for married couples who file jointly.

The individuals who filed tax returns for the years 2022 and 2021 and paid more state income taxes than they owed will receive credits or rebates. These credits or rebates will be automatically issued at a later date. Only those who filed tax returns for the years 2022 and 2021 and paid more state income taxes than they owed will be eligible for a refund.

Students and individuals claimed as dependents, who were employed the previous year, can typically receive refunds if they choose to file taxes separately. However, individuals, such as retirees, who have no state income tax obligations, would not receive any money.

Mike Hodges, a Brunswick Republican who champions bills for Kemp as one of the Republican’s floor leaders, expressed, “Rather than allowing it to remain at the state level, the purpose of this bill is to return state funds to the hardworking people of Georgia.”

Some Democrats argued that allocating state funds towards providing more substantial rebates would have been a more beneficial use of resources for individuals with low-wage incomes, who do not contribute significantly in terms of taxes.

Sen. Elena Parent, a Democratic representative from Atlanta who opposed the legislation, expressed that individuals who do not have a state income tax obligation due to their low earnings despite working full-time will not receive any financial benefits from this bill.

They also argued that the state could better spend the money on expanding healthcare access for funding and providing subsidies for poor families’ childcare, as well as increasing salaries for teachers and improving underfunded state services.

Josh McLaurin, a Democrat from Atlanta, expressed that he would still vote in favor of the bill despite stating that lawmakers had established an anticipation of tax refunds. He emphasized the fact that we have fostered a culture where our budget is not utilized to sustain the government in essential ways, which are crucial for promoting effective governance and providing responsive services to all citizens.

Georgia has completely filled its rainy day fund to its legal maximum of $5.2 billion. This is in addition to the surplus revenue of $6.6 billion that the state accumulated in the previous budget year, as the state coffers continue to experience an overflow. As a result, Kemp has the opportunity to pursue another year of rebates.

The lawmakers approved Resolution 66 with a unanimous vote of 53-0 on Tuesday, which ratifies Governor Kemp’s decision to extend what was originally a six-week holiday on diesel and gasoline taxes that occurred last spring. This move is legal as long as it meets the appropriate sign-off by January, allowing Kemp to continue his reelection campaign.

Officials estimate that they will use $1.1 billion from other tax revenues to keep roadbuilding funds flowing in the current year’s budget. The state has already dipped into its surplus to make up for a revenue loss of $600 million for the budget year 2022. The state estimates that the suspension of the fuel tax will cost them an estimated $1.7 billion in foregone revenue over the course of two years.