Gov. Nathan Deal said he would reluctantly support a measure that stripped a lucrative tax break for Delta Air Lines but also includes broader cuts to the state’s income tax rate.
The Republican was a vocal supporter of the $50 million tax break, which would have eliminated the state’s tax on jet fuels. But Senate Republicans voted Wednesday to strip it out of the measure after Lt. Gov. Casey Cagle said he would “kill” the incentive unless Delta restored ties with a gun rights group.
At a press conference Wednesday, Deal said he was frustrated by the “antics” of Republicans seeking higher office and said he would still seek to salvage a tax break for Delta. But he said he couldn’t veto a measure that also amounted to a sweeping tax cut for residents.
“The real story is the unprecedented $5 billion tax cuts for Georgians,” he said. “The real story is what it has always been: What is in the best interests of our state.”
The Senate Rules Committee voted to delete the provision in a brief meeting Wednesday, capping a showdown between state GOP leader and Georgia’s largest private employer triggered after Delta ended discounted rates for National Rifle Association members.
“It’s a good idea to move forward with this bill,” said Republican state Sen. P.K. Martin, who said the overall measure, which cuts Georgia’s top income tax rate, would have a “positive net increase” for job growth.
The vote capped a showdown between state GOP leader and Georgia’s largest private employer triggered after Delta ended discounted rates for National Rifle Association members.
That move infuriated some conservatives and prompted each of the leading Republican candidates for governor to oppose a jet fuel tax exemption, which would provide Delta about $40 million in annual savings.
Among them is Lt. Gov. Casey Cagle, whose opposition effectively grounded the tax break in the Senate.
Gov. Nathan Deal and other supporters of the tax break, which was approved by the House last week, sought to salvage a deal. The governor warned Senate Republicans this week that refusing to pass the measure could make it more difficult for Delta to compete with other cities with air hubs that don’t charge the tax.
But Cagle and other GOP lawmakers would not change their stance. Describing the feud as a “squabble” with a treasured family member, Cagle told “Fox & Friends” Wednesday the airline wouldn’t be targeted by Republicans if it treated all businesses “fairly.”
“But instead they chose to single out the NRA and their membership – law-abiding gun owners,” said Cagle. “And I don’t think that’s right. I have to govern on principles, and obviously, they have a choice to make.”
Delta officials tried to stem the GOP revolt in a statement that circulated around the statehouse this week saying the company is a supporter of the Second Amendment with a “neutral” stance on a gun debate that sharpened this month after the mass shooting at a Florida high school.
It also noted a past decision to withdraw its sponsorship of a theater that depicted the assassination of President Donald Trump as evidence it has also rejected left-leaning groups.
But the company’s assertion that it wanted to stay out of a “politically and emotionally charged issue” prompted criticism from some conservatives who said the airline has a history of trying to influence the “religious liberty” debate and other state policies.
Before Cagle announced his opposition, he was under pressure from conservatives to reject the Delta tax break. State Sen. Michael Williams, who worked to block a vote on the tax plan in the Senate last week, praised Cagle for backing the effort.
“I’m excited that the lieutenant governor felt the pressure of the movement,” said Williams, also a GOP candidate for the state’s top job. “And I’m excited for the citizens of Georgia to get a tax break without the Delta incentive being held over their head.”
Some supporters of the Delta tax break said there were still ways to help the airline. State Sen. Fran Millar, who represents a Dunwoody-based district, said there are several pending measures that could be amended to attach some sort of incentive.
“I don’t agree that they are consistent to how they are giving out their member discounts, but that’s their right,” said Millar. “I still support them getting a fuel tax cut.”
Deal, too, said he was “committed to finding a pathway forward” for Delta and that he is continuing an open dialogue with Delta and state legislative leaders.
But even staunch backers privately said there was little chance of salvaging the break. The governor’s relationship with Cagle is strained and particularly given opposition in the Georgia House, which also must vote on the changes.
The chamber overwhelmingly approved the tax break last week - before Delta cut ties with the NRA - and House Speaker David Ralston said he was still smarting over that stance.
“The timing of the decision by Delta couldn’t have been worse,” said Ralston, adding:
“I was hoping there would be a compromise, which is why we suggested putting the milk back in the bottle and start over. I don’t know that that’s going to happen.”
More recent AJC coverage of the Delta fallout: