GBPI Responds to Gov. Kemp’s Budget Instructions to Keep State Spending Flat

Over the past eight years (Fiscal Year 2020 to Fiscal Year 2027), Georgia's per-person state spending has decreased by about $23 when adjusting for inflation, which has increased by more than 30% over this period. This means that Georgia's $38.5 billion budget allocates approximately $264.5 million less than if the state had kept up with growth in inflation and population between July of 2019 and 2026. Now, Gov. Kemp has instructed agencies to maintain flat budgets as they prepare requests for Georgia's next governor and General Assembly to consider when writing the state's Amended Fiscal Year (AFY) 2027 and Fiscal Year (FY) 2028 budget.

As the state struggles to meet the basic needs of its residents across healthcare, food assistance and public education, lawmakers recently enacted legislation (HB 463) that would eliminate one third of the state's entire income tax-which funds half of the state budget-reducing revenues by $6.3 billion if fully enacted. This fiscally irresponsible legislation does not include any plan to recoup these lost revenues. It has already contributed to $344 million in spending cuts unilaterally issued by Gov. Kemp through line-item vetoes and non-binding disregards. Although the legislation eliminates 13 income and sales tax credits, the revenues raised total just $10.4 million in FY 2027 and do not even scratch the surface of covering the cost of the tax cuts approved.

If HB 463 is fully implemented, the first 60% of Georgia households would see just 17% of $6.3 billion in tax cuts, less than the 26% share directed to the top 1% and corporate interests.

"The future of Georgia's fiscal health depends on raising enough revenue to balance the state's budget, while meeting the needs of our residents," said Staci Fox, GBPI President and CEO. "Instead of rewriting the tax code for the benefit of corporations and the top 1% who earn an average income of $2.1 million annually, state leaders must prioritize working and middle-income families."

"While Gov. Kemp has already unilaterally issued budget cuts that will harm the most vulnerable Georgians, the budget instructions issued for the 2027 legislative session make clear that our state cannot afford to continue prioritizing corporations and the wealthy at the expense of everyone else. Looking ahead, our leaders must shift their focus to working and middle-income families. Those already at the top of the economic ladder should pay their fair share so that Georgia can get back on track and make the many investments our residents are asking for across health care, education and for the health of our economy."

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