Thumbs up or down on sales tax for personal services?
Services — excluded from Georgia’s 4 percent sales tax — may not be for much longer, AJC writer Chris Joyner reports.
A special council convened to rewrite the state’s tax code has called for the state to move away from income taxes and toward consumption taxes, Joyner writes.
As part of that move, the council recommended that about 50 personal services be taxed for the first time — including haircuts, country club and health club membership fees, shoe repair, veterinary services, lawn care and watch repair, Joyner reports.
The problem, as members of the Special Council on Tax Reform and Fairness see it, is that services have become a larger part of the state economy over the years, Joyner writes. That shift means more of the tax burden is placed on businesses that sell goods — and the tax council concluded that is not fair.
But, the cost to consumers would rise. If the proposal is adopted, the addition of a 4 percent sales tax on services is expected to generate $298 million in new revenue for the state, Joyner reports. Local governments would add another 3 percent, or 4 percent for the city of Atlanta.
The council said the increase in state sales taxes would be offset by cutting income tax rates, Joyner reports. But some are skeptical that will happen.
What do you think? Do you support or oppose this change? Why?
- Henry Unger, The Biz Beat
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94 comments Add your comment
William
February 28th, 2011
9:40 am
This is a bad idea. This would just slow the economy down, futher prolonging the recovery. Small businesses will actually lose income, people would start doing there own hair, and other services. Then because the state did not collect the 298 million that’s projected, they won’t offset the state income tax (like they are claiming now). Before increasing any taxes, the state and local governments need to be better stewards of the money they already have.
huge tax increase
February 28th, 2011
9:41 am
Note they didn’t say they are going to lower income taxes at the same time. This is a tax increase – plain and simple. Not only that, it taxes some people/services and not others – ’some are more equal than others’. This is just the beginning. If this is enacted they will slowly (?) expand the list until all services are taxed. This is bad. VERY bad.
I elect republicans in the hope they will NOT do things like this. I do NOT want ‘tax and spend’. We are already doing that. We need to reduce costs (YES – that means reduced services) first before we enact any tax increase.
N
February 28th, 2011
9:42 am
Since income tax is regressive its a fine idea and encourages saving and investing BUT propose the reduction of the income tax together as one package and many more of us woudl support it.
no cuts!
February 28th, 2011
9:46 am
don’t cut any costs—just create new taxes and raise old taxes!!! Just tax “rich people” who buy “services!” YES!!!—that’s some smooth thinking at the capital!
Jason
February 28th, 2011
9:46 am
Of course the Republicans are going to raise taxes. They always do in the sneakiest way possible. At least in Georgia they have an excuse… most of them are former Democrats who figured out that the easiest way to get elected is to put an (R) after your name regardless of your political values.
There are no fiscal conservatives in Georgia government. Only social conservatives with a corporate welfare mentality. It’s the worst of both worlds.
think this is new?
February 28th, 2011
9:48 am
what u thought these ppl couldnt figure out how to tax you more? lol.
What do you think TARP really was? credit card banks took the tarp money, raised everyones interest rates, then paid back the tarp money. excuse me; but thats really a tax. Dems and repub are all in on it; pay off all your credit cards then cut them up.
study history and find out what the founding fathers thought of banks; stand for something……
BYARD CHARLES
February 28th, 2011
9:49 am
I READ THESE COMMENTS OF SOME OF THE FEED UP CITIZENS AND I WONDER HOW MUCH MORE OF THESE GOV.LIES BOTH FEDERAL AND STATE, BEFORE WE GET THE COURAGE TO TAKE OUR STATE AND OUR COUNTRY BACK, WHAT WILL IT TAKE? I AM SO TIRD OF DISCUSSING THIS WITH FRIENDS WHO’S ONLY RESPONSE IS ‘WHAT CAN I DO I AM JUST ONE PERSON.’?WE ALL COULD ALL VOTE. NOT JUST VOTE, BUT RESEARCH THE CAND.WE VOTE FOR.AND THIS IS MY RULE, IF THEY HAVE EVER BEEN IN POLITICS, FORGET IT. NO VOTE. I, AT THE AGE OR 76 I COULD NOT TELL YOU ONE REP. SEN. OR PRESIDENT WHO EVER DID WHAT THEY SAID THEY WOULD DO AND NOTHING THEY DID WAS ABOUT ME OR FOR ME . AT LEAST NEW BLOOD WOULD TAKE SOME TIME TO GET THE HANG OF GOV.AND SOME GOOD MAY COME OUT OF THAT.I TRULY BELIEVE IT WILL TAKE SOME OF THE ACTION THAT IS GOING ON AROUND THE WORLD TO CLEAN UP WASHINGTON AND GA. AND STEPHENS CO. SO DON’T EVER SAY I AM ONLY ONE PERSON. YOU ARE ALSO ONLY ONE VOTE AND VOTES ARE WHAT MAKES THE DIFFERENTS.
marilyn
February 28th, 2011
9:50 am
i would like to see a list of the jackels that are on this council
emack06
February 28th, 2011
9:57 am
This is a very stupid idea. He.ll, we are taxed enough. Property Tax, Payroll Tax, Sales Tax, Gas Tax, utility taxes and fees, Ad valorem tax, etc…get the picture. These politician have no clue or they just don care. These outrageous taxes are killing the middle class. They must not be smart enough to manage the money they are ready receive or its just plain greed on their part.
Teacher Reader
February 28th, 2011
9:58 am
These taxes will just become a burden on small business owners increasing the money that they spend to run their business as this will be another thing an accountant will need to do. The small business owner, knows that people will only pay so much for a hair cut or lawn service, or whatever. If they charge more, they will not get the business and will close. Many small business owners will just close their doors and say forget this.
I don’t understand why the government officials aren’t looking for better ways to spend tax payer money. My salary has been cut and I have to do the same with less. We do without things, so that we can have food and such on the table. Why not look at how to better manage funds.
I also don’t want to spend more money so that public service employees get their full pensions as I don’t have a pension. I have had to save money for my retirement. The public cannot afford to pay for the retirement of a few while the public struggles to make ends meet in their own home.
emack06
February 28th, 2011
10:02 am
This move is clearly a shift of the tax burden from the rich to the middle class. The poor and working class cannot afford these services, so the middle class will be left holding the bag.
Road Scholar
February 28th, 2011
10:04 am
B CHARLES: Forget about politics; you need a crash course on spelling, grammar, and proof reading!
ED
February 28th, 2011
10:31 am
If the Gov can’t make it on the money they’re bringing in now, what makes you think that changing the tax law is going to bring in LESS money? They are changing the tax law to bring in MORE money fellow tax payers. Smoke and mirrors is what this is.
Destin Dawg
February 28th, 2011
11:05 am
Repub or Demo… be glad you’re not in a union… put $$$ that would have been union dues into an IRA. acct.. invest in a Balanced mutual fund… for 30+ years and you’ll have a better retirement than union workers… and NO PUBLIC UNIONS !! we need math and science teachers.. not a seniority system.. that stifles qualified young teachers
J L
February 28th, 2011
11:06 am
The state should rescind the recent give aways to people over 62 in the state of Georgia. This year their exemption from income tax is $ 35k per person plus deductions and exemptions. This has eliminated 90% of people over 62 from paying tax. In 2013, everyone and all income would GA tax free. Please explain this free ride for them.
Unpaid revenue collector
February 28th, 2011
11:21 am
Taxing services will not improve our deficits – especially in a consumer economy. By doing so the government makes every shop owner or service provider an UNPAID REVENUE COLLECTOR. There is cost in being an agent for the government that each will have to absorb PLUS the actual tax will be offloaded to the public. Secondly, our government must address the core problems before it begins bleeding our citizens. There is only so much blood you can extract from someone before they become more ill and there are many financially stressed people already.
Ms. Dawg
February 28th, 2011
11:58 am
Taxes on services as opposed to income will burden the senior citizen living on a fixed income moreso than the current tax structure. But then, who among our elected officials really gives a hoot about senior citizens living on a fixed income.? Kick the bums out !!!!!!!!!!!!!! Now !!!!!!!!!!!!!!
Broke
February 28th, 2011
12:18 pm
The economy is in a depression, governments are spending too much money, refuse to make real cuts—instead, they are coming up with new taxes? Amazing stupidity.
Jeremiah
February 28th, 2011
12:46 pm
Wow…I can honestly say that I am appalled at what appears to be coming down the track. I suppose then that our lovely congress-critters and other lawmen of this state will be paying taxes on their lawn care and gym memberships, or will that simply be one of the perqs of “public service”. I would love to know in this time of economic hardship what our politicians are doing to bring their spending in line with their bank account balances. Oh wait, their balances are our tax dollars and they just decided to jerk some more money outta my A**, unbefreakinglievable. Ya’ll under the dome need to wise up, and so do we the sheep. Revolution is on the horizon if this continues.
“And what country can preserve its liberties, if the rulers are not warned from time to time, that this people preserve the spirit of resistance? Let them take arms.” -Thomas Jefferson, 1787
Wendy Breeze
February 28th, 2011
1:30 pm
We tell our legislation to cut back. That is, until they cut back on something we like. THAT’S the problem.
Grow a spine legislators, and make the hard decisions. You cannot please everyone.
Monroe
February 28th, 2011
1:50 pm
These taxes on services will hurt the low income and people of color the most—just another example of rich people running the state trying to take advantage of minorities. I’m getting tired of this may move back to philadelphia next year.
JM
February 28th, 2011
1:52 pm
Stop bleeding me dry! This state govt already takes too much of my money to do things I don’t want done. Now, you are going to force small businesses to become crooks to stay alive.
This state is most punishing to small business that I’ve ever seen.
Brian
February 28th, 2011
3:38 pm
Greg Orr,
George Harrison wrote that tune. Not, MacLen
PTimer
February 28th, 2011
4:20 pm
What’s next? I wonder when we’ll see a tax on the “services” the legislators provide? Public service may come to have a whole new meaning!
Dr. Craig Spinks/ Augusta
February 28th, 2011
4:28 pm
Has any agency of state government ever undergone a comprehensive performance audit conducted by a competent, disinterested, out-of-state entity? Has any such audit been released to the media?
gkingii
February 28th, 2011
5:55 pm
OK, drop the income tax first, the talk to me about raising sales taxes. DON’T raise sales taxes or apply them to services until the corresponding drop in income tax is approved.
Anita Berk
February 28th, 2011
6:01 pm
Hey folks… get together and don’t let this happen! We have a service tax in OH and if you have your grass cut for say $40 a week and it is taxed at 7% (OH rate) , add $11.20 to your grass cutting bill. If you have a plumber, add the tax. Incomes aren’t going up, good paying jobs are scarce and those elected officials need to cut back as all of us have had to do. YOU WON’T GET TO VOTE ON THIS ONE. LET YOUR VOICE BE HEARD.
LL
February 28th, 2011
6:07 pm
I don’t believe for a second that they will offset these new taxes by cutting our income taxes. Once they start taxing services – we will be burdened with paying both from now on. I cannot understand why elected officials cannot balance a budget…They spent money like crazy when times were good – when they should have saved. Isn’t that what financial experts are always telling the rest of us…to live within our means! LISTEN UP LEGISLATORS: I do not have an endless supply of money in my pocket! I received a pay cut at my company over 2 years ago now! I haven’t had a raise in nearly 3 years! And, I haven’t had a bonus since – I don’t remember when! How do you expect people to keeping paying more and more when we make less and less?! How about the price of gas!?! I will have to cut the services my family and I utilize – so guess what that means – I hurt the economy. It is a no-win situation. Great job, legislators!
Stop the madness!
February 28th, 2011
7:06 pm
I am shocked and extremely disappointed with our state republican leaders absolute silence on this TAX INCREASE. Shame on the pubs for pushing this garbage down our throats..I’m positive my 400 customers( 300 are Voters) think this plan is very bad news and will be infuriated if this goes through!
Gooddawg
February 28th, 2011
7:43 pm
WELL DUH!!! Read my lips. We don’t have a “revenue” problem we have a “spending” problem. As soon as we raise revenue the MORONS in the general ASSembly will find a way to spend it. Pretty soon we’ll be like FloriDUH!!
BLeeFloyd
February 28th, 2011
8:20 pm
It will cost more to collect and enforce this servies tax than the revenue produced.
Retired Senior
February 28th, 2011
8:33 pm
Any politician that votes to approve this insane bill will be targeted for defeat in the very next election.Cut spending,don’t increase any tax on anything.NO MORE TAXES DAMIT.
Winfield J. Abbe
February 28th, 2011
8:33 pm
Every business in Georgia is treated unfairly like garbage. Think of it: Many selected businesses are forced to collect the sales tax for the State and paid only a pittance of what the true cost is for the collections and responsibility of this job. What if the State had to collect all its own taxes with a booth on the right of way in front of every business?
The only legal way to deal with these foolish, lying politicians is the boycott. Shut down your businesses tomorrow. Fire all employees. This would get their attention.
As stated by others above, churches are businesses and must be taxed. Lawyers must be taxed heaviliy. And think of the UGA football coach who makes about $ 3 million a year, the highest paid employee in state government. His taxes will be lowered with this foolish bill. Instead he and all the other good for nothings at UGA like Adams should be surcharged on their tax bill shouldn’t they? Adams makes about a $l million per year.
Shut down your businesses tomorrow. Go on Strike. This was the theme of Ayn Rand in “Atlas Shrugged”. Do it! Government cannot force you to stay in business yet.
Imagine what these good for nothing politicians would do if all businesses shut down tomorrow in Georgia? They would be begging you to open up!
AskZellMiller
February 28th, 2011
8:40 pm
Zell Miller tried to tax auto sales from individual to individual in the early 90’s. What a fiasco. Stopped it within a year. That was considered doable at the time, but it wasn’t. At the same time tax on services was considered and not passed. Didn’t work then, won’t work now. Just raise the state sales tax rate and be done with it. Show a little courage state legislature.
Winfield J. Abbe
February 28th, 2011
8:49 pm
Do you know why government does not have enough tax money? The answer is because of so many citizens, if you can call them that, who live off the fruits of others, who are deadbeats, drones, who won’t pay their fair share of costs and effectively add weight to a sinking ship without paying their own way. These are the people who have kids but no money to pay the costs of those kids, so others are forced to pay for them. These are the people who live in public housing, who use the indigent fund at hospitals for their healthcare while you pay thousands of dollars for insurance, people who constantly refuse to obey rules and laws thus overtaxing the judicial system which you and I and all the other responsibile citizens must pay for year in and year out, while these good for nothings are constantly indulged and apologized for by politically correct lying politicians.
Do something: Go on strike. This is your only legal remedy to government tyranny here or anywhere, now or in the future. Talk is cheap and the lying is easy for politicians who pay no penalty for lying as they demand you pay when you lie to government.
Winfield J. Abbe
February 28th, 2011
9:01 pm
Ayn Rand was a pen name or “nom de plume”. She immigrated here legally from the Soviet Union in the early part of the twentieth century. She had observed the horror of government tyranny in Russia and that butcher Stalin and the great failures of Communism. She witnessed the greatness of America. She observed what it produced for people in its greatest time of the industrial revolution.
She also observed its decline and predicted its ultimate destruction in her great book which has sold and continues to sell millions of copies every year: “Atlas Shrugged”.
She hated Robin Hood and Karl Marx and everything they stood for: Steal from the rich and give to the poor, resulting only in everyone being poor. She dramatized all this in her great novel. Read it if you have not already done so.
She advocated the only legally available remedy against government tyranny: The boycott, the strike. Everyone and every group in history has gone on strike except one: The producers of society. She advocated for the producers finally, for once and for all, to go on strike. This is your only legal remedy against lying good for nothing politicians. Fire all employees tomorrow and go on strike. This will teach a lesson no one can ignore or forget. This is the only kind of language they can understand with their small brains.
john wolfel
February 28th, 2011
9:14 pm
florida tried this about 20 years ago and it was a flop.
it was repealed about 1 year later. the politicians need to go on a diet rather than thinking about getting more to eat.
Dave from GT
February 28th, 2011
9:22 pm
Just looked at the list of svcs to be taxed…….. they want to tax lawncare svcs, but not lawyer svcs!!!
robert
March 1st, 2011
12:13 am
What a joke! for Mr. Deal and his republicans cronies to think of lowering state income taxes to increase consumer taxes on additional consumer services in Georgia. What a Freaking joke! Ga unemployment will continue to rise within the next 10 months and longer as the local housing market continue to spiral downward for major corrections. Very little job growth locally are within sight in the near future and, as we may know–these jobs may provide low salary –which also means, low revenue for local government. These government elected thieves and %%% sucking cronies already know that most future jobs growth in ATL will be low paying jobs and with very, very little job growth. Sadly, these cronies, prefer to raise taxes on consumer goods and services. Which also means, more job loses in Georgia and more heavy consumer cut backs on spending will also rise. Our local schools system will continue to experience more spending cuts; our local colleges and universities will increase cost to balance cuts; our economy will continue to tank ; more homeowners will continue to lose homes and more foreclose homes will hit the an already swollen foreclose market. Don’t believe me –Go figure! Georgia do not have the capital as The Republicans State of Texas and Florida have to eliminate state income taxes as these republicans try to duplicate—The Bush States. Therefore, Georgia CAN NOT imitate them. Our economy and revenue growth is totally different. The republicans will destroy this state. Don’t believe me?–stick around and you will see. It’s already happening very slowly people.
Tom
March 1st, 2011
3:09 am
This sucks. I am moving to Florida.
Debora Slatten
March 1st, 2011
3:46 pm
I am quite disheartened by the inclusion of veterinary services in their listing of options. Quite clear the powers that rule (yes, I used the correct verbiage) us feel that this list is services that are optional, luxurious, or services that one could do on their own or live without. Veterinary services do not fall in any of those categories. Many people are already doing without optional vet services because of the economy or allowing their beloved companion to go to his/her resting place instead of a surgery or procedure that could be used to save his/her life. Taking our ability to provide humane care for our beloved companions, is cruel and inhumane. But why would I expect them to be anything more than cruel and inhumane?
ayn rand
March 1st, 2011
5:41 pm
if I go on strike, how will I pay my bills? The government will take my house and money. Where will I live.
Bill S
March 2nd, 2011
7:39 am
Bad ideal. I know any further drops in my business by increasing taxes and I will have to layoff another employee. Not something I want to do, but that is what I will do to keep my business open. That is how it works.
ENOUGHalready
March 5th, 2011
1:46 pm
I deliver pizza for a living. Every day I deliver orders (minimum $25 orders and sometimes as much as $50) to public housing complexes. I see tax dollars supporting people that somehow have the money to spend on pizza and 52 inch televisions. Not to mention the countless brand new cars that I see. Meanwhile I have to take a cut in pay just to keep my job. NO MORE TAXES FROM ANY SOURCE. CUT SPENDING.