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Georgia's $16 billion tax gamble

Georgia's $16 billion tax gamble

Rule Changes

Lt. Gov. Burt Jones pushes income tax elimination as centerpiece of governor bid

January 13th, 2026: Legislative Session Opens

Overview

Updated May 19

A Georgia Senate committee voted 6-3 along party lines to eliminate the state's income tax by 2032, starting with exempting the first $50,000 for individuals and $100,000 for couples in January 2027. The move would immediately blow a $3 billion hole in the state budget mid-fiscal year, eventually eliminating a $16 billion revenue stream that funds schools, healthcare, and infrastructure.

Lt. Gov. Burt Jones formed the committee and made income tax elimination his signature campaign promise as he runs for governor. But the plan faces internal Republican resistance—House Speaker Jon Burns wants property tax cuts instead, and term-limited Gov. Brian Kemp has been cool to full elimination.

The GOP is split. Democrats warn of cuts to rural healthcare, mental health, and education.

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Key Indicators

$16B
Annual income tax revenue at stake
Total revenue stream that would be eliminated by 2032
$14.6B
State surplus reserves
Georgia's current cash reserves as of July 2025
67%
Georgians affected by first phase
Two-thirds of working Georgians would see initial tax elimination
$30B
Special-interest tax credits
Republicans propose trimming 10% to fund the cuts
5.09%
Current income tax rate
Reduced from 5.19% on January 1, 2026

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People Involved

Burt Jones
Burt Jones
Lieutenant Governor of Georgia
Running for governor in 2026 Republican primary
 Blake Tillery
Blake Tillery
Georgia State Senator, Chair of Appropriations Committee
Led the income tax elimination committee
 Nan Orrock
Nan Orrock
Georgia State Senator (D-Atlanta)
Vocal opponent of income tax elimination plan
 Jon Burns
Jon Burns
Speaker of the Georgia House of Representatives
Advancing competing property tax cut proposal
 Brian Kemp
Brian Kemp
Governor of Georgia
Term-limited, serving final year; cool to full income tax elimination
 Chris Carr
Chris Carr
Georgia Attorney General
Running for governor in 2026 Republican primary
 Brad Raffensperger
Brad Raffensperger
Georgia Secretary of State
Running for governor in 2026 Republican primary
 Danny Kanso
Danny Kanso
Senior Fiscal Analyst, Georgia Budget and Policy Institute
Leading policy critic of income tax elimination

Organizations Involved

Georgia Senate Special Committee on Income Tax Elimination
Georgia Senate Special Committee on Income Tax Elimination
Legislative Study Committee
Completed recommendations, approved by 6-3 vote

Ad hoc committee formed by Lt. Gov. Burt Jones to study eliminating Georgia's income tax.
Georgia Budget and Policy Institute
Georgia Budget and Policy Institute
Policy Research Organization
Published analysis critical of income tax elimination

Nonpartisan research organization analyzing Georgia fiscal policy and budget priorities.

Timeline

2022 January 2026

15 events Latest: January 13th, 2026 · 8 months ago Showing 8 of 15
Tap a bar to jump to that date

  1. Legislative Session Opens

    Latest Legislative

    Georgia General Assembly convened for 40-day session running through April 2. Tax relief dominated opening day agenda as competing Senate-House visions entered active legislative phase.

  2. Burns Details Homestead Tax Plan

    Statement

    Speaker Burns clarified his competing vision: eliminate property taxes only on primary residences (homesteads), leaving rental properties taxable by local governments.

  3. Senate Committee Approves Elimination

    Legislative

    Special committee voted 6-3 along party lines to recommend phased income tax elimination by 2032.

  4. Burns Announces Competing Plan

    Statement

    House Speaker Jon Burns said House will focus on property tax cuts, not income tax elimination.

  5. Tax Rate Drops to 5.09%

    Implementation

    Scheduled 0.10% reduction took effect, continuing Kemp's incremental approach.

  6. Democrats Blast Elimination Plan

    Statement

    Sens. Nan Orrock and Ed Harbison issued statement calling proposal disastrous, benefiting wealthy at middle-class expense.

  7. Georgia Reports $14.6B Surplus

    Budget

    State fiscal year 2026 began with record reserves: $5.6B in rainy day fund, $9.1B undesignated.

  8. Raffensperger Enters Governor's Race

    Campaign

    Secretary of State Brad Raffensperger joined the race pledging to eliminate income tax, adding a third major candidate.

  9. Trump Endorses Jones

    Political

    President Trump endorsed Burt Jones for governor, boosting his insurgent campaign against establishment favorite Chris Carr.

  10. Jones Launches Governor Campaign

    Campaign

    Lt. Gov. Jones officially entered governor's race, pledging to eliminate state income tax, lending campaign $10 million.

  11. Jones Forms Special Committee

    Legislative

    Lt. Gov. Jones created Senate special committee to study income tax elimination, chaired by Sen. Blake Tillery.

  12. Kemp Accelerates Tax Rate Reduction

    Legislative

    Governor signed HB 111, reducing income tax rate from 5.39% to 5.19%, retroactive to January 2025.

  13. Chris Carr Enters Governor's Race

    Campaign

    Georgia Attorney General Chris Carr announced candidacy for governor, becoming early frontrunner.

  14. Burt Jones Elected Lieutenant Governor

    Election

    Jones won election after serving 10 years in the state Senate, gaining platform to advance tax agenda.

  15. Kemp Creates Flat Income Tax

    Legislative

    Gov. Brian Kemp signed HB 1437, eliminating Georgia's six income tax brackets and creating a flat 5.49% rate.

Scenarios

1

Plan Dies in Republican Civil War

Likely

Discussed by: Implied by Georgia Recorder and AJC coverage of competing House-Senate priorities

House Speaker Jon Burns refuses to bring the Senate plan to a vote, instead passing property tax cuts. Jones uses the stalled proposal as a campaign rallying cry, but without legislative achievement to point to, his signature issue becomes aspirational rather than deliverable. Chris Carr benefits by positioning himself as the pragmatic candidate who can actually govern. The income tax remains at 5.09% with incremental reductions continuing under existing law.

2

Compromise: Partial Exemption Passes

Possible

Discussed by: Potential middle ground between House and Senate positions

Facing pressure from Jones's campaign and conservative base, Burns negotiates a compromise that exempts the first $50,000/$100,000 as the committee recommends but abandons the full elimination timeline. The partial cut takes effect in 2027, giving two-thirds of Georgians a significant tax break while preserving most income tax revenue. Jones claims victory and rides the achievement to the governor's mansion, but inherits the budget consequences of the cut he championed.

3

Full Elimination Triggers Budget Crisis

Unlikely

Discussed by: Georgia Budget and Policy Institute warnings echoed by Senate Democrats

Jones wins the governorship and uses Republican legislative majorities to ram through full elimination on his proposed timeline. The $14.6 billion surplus proves insufficient as economic headwinds reduce revenue and alternative financing falls short. By 2028, Georgia faces brutal cuts to education, rural hospitals close, and the state's credit rating is downgraded. The Kansas experiment repeats itself as Georgia becomes a cautionary tale, forcing an eventual tax increase that destroys Jones's political future.

4

Carr Wins, Shelves the Plan

Possible

Discussed by: Political observers watching the Republican primary dynamics

Chris Carr defeats Jones in the Republican primary by consolidating establishment support and appealing to voters worried about fiscal stability. Carr wins the general election and quietly shelves income tax elimination, continuing Kemp's incremental reduction approach instead. The special committee's recommendations gather dust as Georgia pursues targeted tax relief. Jones's political career stalls, and the brief window for radical tax reform closes.

Historical Context

3 moments from history that rhyme with this story — and how they unfolded.

1980-present

Alaska Income Tax Repeal (1980)

Alaska became the only state in 45 years to fully eliminate its income tax, made possible by billions in oil revenue flooding state coffers. The state replaced income tax revenue with oil royalties and established the Alaska Permanent Fund, which pays dividends to residents.

Then

Alaskans enjoyed income tax-free status while oil revenues funded government services

Now

Alaska's dependence on volatile oil revenue created boom-bust budget cycles, and recent oil price crashes have forced painful cuts despite the lack of income tax

Why this matters now

Proponents cite Alaska as proof income tax elimination can work, but critics note Georgia lacks Alaska's unique oil wealth to replace the revenue stream.

2012-2017

Kansas Tax Experiment (2012-2017)

Governor Sam Brownback slashed Kansas income taxes with a path to full elimination, promising economic growth would offset revenue loss. Instead, growth lagged the national average, revenues collapsed by hundreds of millions, and the state gutted spending on roads, bridges, and education. In 2017, the Republican-controlled legislature overrode Brownback's veto to reverse the cuts.

Then

Budget crisis forced deep cuts to essential services and infrastructure

Now

Brownback's political career ended, and Kansas became the cautionary tale cited by opponents of income tax elimination nationwide

Why this matters now

Georgia Democrats explicitly invoke Kansas as proof that income tax elimination leads to fiscal disaster, while Republicans argue Georgia's $14.6 billion surplus prevents the same outcome.

2025-2040 (projected)

Mississippi Income Tax Phase-Out (2025)

Mississippi became the first state since Alaska to legislate income tax elimination, with Governor Tate Reeves signing a law to gradually reduce the 4% rate to 3% by 2030 and eventually eliminate it by 2040. The phase-out includes revenue growth benchmarks that trigger reductions, providing fiscal guardrails.

Then

Law just enacted; initial rate reductions beginning with cautious triggers

Now

Full elimination won't occur for 15+ years, and revenue benchmarks may delay or prevent complete phase-out if growth falters

Why this matters now

Georgia Republicans point to Mississippi as the model for successful elimination, but Mississippi's 15-year timeline and built-in safeguards contrast sharply with Georgia's aggressive 6-year plan.

Sources

(22)
+16
Rough Draft Atlanta Atlanta Journal-Constitution Georgia Public Broadcasting Georgia Budget and Policy Institute U.S. News & World Report Georgia Recorder WRDW Georgia Senate Press Office Wikipedia Georgia Governor's Office Georgia Department of Revenue Capitol Beat News Tifton Gazette Newsweek The Current The Georgia Virtue AM 1180 Radio Moultrie Observer Insurance Journal Georgia Public Broadcasting Georgia Budget and Policy Institute WRDW