Despite their usual anti-tax outlook, they are reluctantly getting behind a proposal from Gov. Sonny Perdue to levy a 1.4 percent tax on hospital revenues. If it is approved, it would bring in about $175 million to help close the state's yawning budget gap, which shows no signs of improving. State revenue collections have been declining 15 months.
Hospital officials had been against the proposal, not surprisingly, but now are in favor. Ditto for most of the Legislature's rank-and-file Republicans.
"I do expect it to have strong support (from the GOP caucus)," said Majority Leader Jerry Keen on Tuesday. "When you're staring at virtually no money in the budget, there are some things you do that you wouldn't do otherwise."
Perdue got the hospitals on board by threatening them with a plan to slash Medicaid reimbursements to them by 10.25 percent if they didn't support his tax plan. He also had threated to eliminate the state sales tax exemption for nonprofit hospitals, so that they would have had to pay sales taxes on their purchases. So in essence, they now have decided the new tax is the lesser of three evils, and the others have been taken off the table as part of the agreement.
"This process has not been easy," said Earl Rogers of the Georgia Hospital Association. "But the hospital recognizes that we need to be part of the solution. This is a reasonable, solid proposal that will help the state with its budget situation."
The new tax - which cannot be passed on to patients - was approved on Tuesday by the House Appropriations Committee and now moves to the House Rules Committee. The tax would only be levied though 2013. After that, the economy will presumably - hopefully - have picked back up and lessened the need for the tax.
No one likes tax increases (or fee increases, which is what some are styling this measure). But with the state budget crisis what it is, it is only realistic to expect that its pain must be shared across the board, and that anyone can expect to be exempted from it.












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