March 17, 2008
Atlanta Journal-Constitution on Removing the "Birthday Tax" on Vehicles
EQUAL TIME: Axing the 'birthday tax' will boost state economy
By Mark Burkhalter, Atlanta Journal-Constitution
Great leaders of free and prosperous societies get this economic concept: When government cuts taxes, it stimulates the economy and brings more revenue into public coffers.
Consider some honored statesmen who turned their nation's economies around with such creative tax policy. John F. Kennedy, Margaret Thatcher, Ronald Reagan, just to name a few.
They each enacted significant tax cuts that not only stemmed recessions but brought more revenue to their governments.
When taxes are cut, consumers have extra cash, and they spend it. They buy a new pair of jeans, go out to dinner, take a vacation or purchase the latest flat-screen television. That creates more jobs and generates more tax revenue for federal, state and local tax coffers.
The best predictor of future behavior is past behavior, so we know that's exactly what will happen when Georgia families don't have to pay "the birthday tax" on their vehicles annually. They will spend that newfound money.
The Georgia House has adopted legislation to allow voters to abolish this offensive ad valorem tax on personal vehicles. The Senate should quickly follow.
Any worrywarts concerned about the projected $679 million impact to the state budget when the tax is fully implemented in 2010 need only look at the history of tax cuts in this nation to get comfortable about what tax cuts can do for government revenues.
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According to the Tax Foundation in Washington, New York state, meanwhile, responded to 9/11 by raising taxes, which in turn hurt that state's economy. Only when those taxes expired did New York begin to recover. [Read the full article.]
