RICHMOND HILL — State House Speaker Glenn Richardson, who has been referred to as an “agent of change,” says that when he took office, he could’ve decided to do nothing. But instead, he said it’s his job to evaluate how Georgia government is impacting its residents.
Richardson came to Richmond Hill on Thursday to speak to local Rotarians and county officials about his proposed House Resolution 900, with the goal is to eliminate property taxes in the state of Georgia.
“I think we’re elected to look at what we’re doing and ask, is this the best way to deliver services to our citizens?” Richardson said. “Local governments have said, ‘How dare I change their system of governance. How dare anybody from the state propose change?’ And I look at them and say, ‘How dare anyone stop the people from determining their system of governance.’”
Richardson said his plan, known as the GREAT plan, will absolutely work.
“You can have a system that funds local government based on a consumption/sales tax that’s pay-as-you-go, and get rid of property taxes,” he said.
The basics of the plan come down to one simple question in Richardson’s eyes: Do Georgians want to change from what’s been done for the last century to a new system? Richardson pointed out the tax system in Georgia was created in 1848 — when income, sales and property taxes didn’t exist.
“Should the Constitution of Georgia be amended so as to provide the elimination of all property taxes in the entire ad valorem system of taxation, in favor of a sales use and services tax set forth in the GREAT Plan for Georgia?” he asked.
Richardson’s figures showed that total revenue in Georgia went from $8.2 billion in 2005 to $9.7 billion in 2006.
“I don’t care how you slice it. That’s a $1.5 billion increase that people paid to their local governments in one year’s time,” he said. “I’m trying to change this because I see a system that funds the most important thing we do — education — and funds local government with a system that is unfair, inequitable and out of control,” he said, pointing out property taxes are outpacing the ability of people to pay it with raising revenues.
The current system is backwards and out of touch with today’s economy, according to Richardson.
“You get your property tax bill each year and you’ve got two clear choices. You can either pay it or not. You pay it, and you get along. You don’t pay it, we take your house. With a consumption tax, you go to the store and you say, ‘I don’t want to pay that tax,’ so you don’t buy it,” he said. “This current system is discombobulated.”
Richardson admitted there is no single explanation. But the fact that the economy has changed so drastically since the taxation system was first enacted is a sign that something needs to be done, he said.
“We only tax about $142 billion from goods, and there is $140 to $240 billion dollars in services that we don’t tax at all. You see, in the year 1850 the only thing we had to tax was crops. In 2007, we don’t have crops, we have services, yet we don’t tax them at all.”
He said he’s open to considering just certain parts of the plan be instituted, or to the idea of phasing it in gradually.
There has also been consideration of it being a “sunset” plan, where it would be instituted under the stipulation of returning to the ballot after a short period of time for reevaluation from Georgians. He admitted there are 1,000 more questions, but that thinking about change is the first important step.
Richardson’s numbers for the plan were figured by economist Arthur Laffer, who is best known for his work as an economic advisor for Ronald Reagan. To see calculations and more information about how the proposal has been laid out, visit www.theGREATplanforGeorgia.com.