Georgia legislators are considering giving generous tax breaks to individuals and families who move to rural areas.
The combination of state income tax incentives and local property tax discounts could be worth tens of thousands of dollars over the years for anyone who chooses country living.
The relocation payments are meant to repopulate rural areas that are losing residents and businesses to metro Atlanta and other major cities in Georgia.
The tax proposals were among many recommendations — along with high-speed internet, health care access and economic development initiatives — endorsed by the Georgia House of Representatives Rural Development Council on Wednesday. These recommendations could be incorporated into bills for consideration during the 2018 legislative session. which starts Jan. 8.
“Rural areas are losing their most valuable resource for economic survival — people,” according to the council’s report. “Rural communities must figure out how to attract and retain its younger population, as one million baby boomers are set to retire in the next 10 years and the millennial workforce is leaving rural Georgia.”
The biggest tax breaks would go to rural newcomers with the highest incomes. That’s by design in an effort to attract business owners, doctors and professionals to rural areas, said Rep. Jay Powell, R-Camilla, the chairman of the tax-writing House Ways and Means Committee. But tax breaks would also be available to anyone who relocates, regardless of their incomes.
“You’re not going to create jobs if you don’t have the people,” Powell said. “We can attract people to move into a community by giving them tax deductions and giving them residential real estate tax abatements.”
Costs to taxpayers and other details of the plan are unclear until specific legislation is introduced and evaluated. The incentives would be available to residents who move to any of the state’s 124 counties with less than 5 percent population growth over five consecutive years:
- Up to $3,000 a year worth of income tax discounts over 10 years for new rural residents. Specifically, the council recommended an income tax deduction up to $50,000, which works out to the $3,000 benefit for those paying the state’s top income tax rate of 6 percent.
- Property tax abatements over 10 years for new residents. Legislators might allow local governments to pass a referendum for these property tax breaks, which are similar to the incentive programs used by counties and cities to attract businesses. The benefit could start by forgiving the entire property tax bill of a new resident in their first year, then gradually decrease over a decade until residents pay their full property tax.
- Doubling the income tax discount for new residents in counties that adopt the property tax abatement proposal. In these counties, new residents could deduct up to $100,000 a year for 10 years from their income taxes, worth $6,000 annually for someone paying the state’s top tax rate.