“Texas by far is the most business-friendly state,” Olens said. “They haven’t had a recession.”
Gov. Nathan Deal has tried to get sweeping tax reform through the General Assembly, Olens said, but to date the Legislature has only been willing to take small steps.
“And I think it’s really necessary to take the big step,” he said. “If you look at all the tax credits and other types of corporate welfare we have in our state, you’re sort of choosing some winners and losers in that regard. Wouldn’t it be better to simply have no corporate welfare, eliminate the income tax and put all companies on the same level playing field?”
Momentum to eliminate the income tax is building, Olens said.
“I think the Governor pushed it early on in his administration,” Olens said. “You saw President Pro Tem David Shafer speak in favor of over several years eliminating income tax towards the beginning of the session. You saw some House legislators discussing it towards the very end of the session. I think it’s one of those issues that just takes several years to get the necessary momentum.”
Georgia’s neighbors, Florida and Tennessee, don’t have an income tax, Olens said.
“You know, I think we need to stop the game of the credits and the deductions and just stop the tax where you don’t need it at that point,” he said.
The industries in Georgia that receive corporate welfare are vast, ranging from manufacturing to aeronautics.
“It’s not that I don’t support helping business, it’s I support helping all business rather than once again choosing which business,” Olens said. “I think it is our obligation to tell our members of the General Assembly that we really want the session to get jobs, and that doesn’t mean corporate welfare that means replacing the tax code, both federally and state, and having guidelines that actually promote job growth, and I think that’s the key issue. We spend entirely too much time on the small stuff. And we’re not spending nearly enough time on the big stuff.”
Among those at the breakfast, held at the county GOP’s Roswell Road headquarters, was J.D. Van Brink, chairman of the Marietta-based Georgia Tea Party, who said he agreed with Olens.
“The thing is the corporate tax in Georgia pulls in only about a little bit more than three percent of the state revenues, but when you think of the cost of compliance for business in order to comply with the corporate tax, so it’s not just the tax itself, which is a pass through tax onto all of us, the consumers,” Van Brink said. “There’s also the cost of compliance which is passed onto us, and it makes us less competitive with our neighboring states, and so if we were to eliminate it we would probably end up making even more in tax revenue with the increased tax base from businesses moving here from Georgia, if we made the cost of doing business here less. And we’ll benefit from that.”
In a March Wall Street Journal column, Arthur Laffer and Stephen Moore predicted a zero-income-tax domino effect in the South.
“Georgia can hardly sustain a 6 percent income tax if businesses can skip across the border into neighboring states like Florida, Tennessee or South Carolina,” the authors wrote.
Advocating vs. educating on tax increases
During the question and answer part of his talk, Lance Lamberton of the Cobb Taxpayers Association asked Olens whether it was legal for an elected official, once an election has been called for a special purpose local option sales tax, to advocate for or against that SPLOST.
Olens said as a general statement, elected officials do not lose their First Amendment rights and can discuss how they feel about ballot items as long as it does not involve “any” government resources or time.
“When you start using fax machines, copy machines and email, that’s when you are violating versus exercising your First Amendment rights,” Olens said.
If someone believes an elected official is advocating for a tax, the agency they report to is the Georgia State Ethics Commission, Olens said.
The attorney general’s office handles sunshine law violations and SPLOST violations where a government has promised to spend the sales tax revenue on one project, but spends it on another.
Another audience member asked Olens what happens when videos that promote a SPLOST are filmed inside a public school. That school’s electric bills are paid for by taxpayers, the questioner said. Or what about using images of a school bus full of children to promote a SPLOST?
Olens said it is difficult to draw a line between education and advocacy.
“If you go to a school email address, and you send to 5,000 constituents, ‘Vote yes on the SPLOST,’ that’s advocacy,” Olens said. “If you do it on your personal email address from your house, that’s not advocacy because that’s the First Amendment right of that elected official. So we all know the wide yes and nos. There’s one heck of a gray.”
The rules are based on Georgia law approved by the General Assembly, not him, Olens said.
“And I would suggest to you that my office has spent a good amount of time — and I’m sure there are numerous legislators that have spent a good amount of time — trying to better divide where advocacy and education collide,” Olens said.
“It is tough. That is just not an easy discussion to put in writing. And that is where you run into the big issue. It’s a tough issue.”
Olens shared with the audience how he handled such cases when he was chairman of the Cobb Board of Commissioners.
“Of course we always took the perspective that anything close we weren’t going to do because we didn’t want the public growling at us,” Olens said. “But having said that it is really tough to find the exact perimeter that divides advocacy from education.”
Saturday’s event was full of notables, among them Bob Barr, who is running to replace Rep. Phil Gingrey (R-Marietta) in the U.S. House as well as two others who are said to be considering jumping into the race: Tricia Pridemore, executive director of the Governor’s Office of Workforce Development, and Majority Whip and state Rep. Ed Lindsey (R-Atlanta).
Former Secretary of State Karen Handel, who is said to be considering a run to replace retiring U.S. Sen. Saxby Chambliss, was present, as were state Reps. John Carson (R-Northeast Cobb), Charles Gregory (R-Kennesaw), Cobb District Attorney Vic Reynolds, Cobb Superior Court Judge Reuben Green, Cobb State Court Judge Marsha Lake, Commissioner JoAnn Birrell and Cobb Board of Education members Tim Stultz and Scott Sweeney, among others.