Bill review: Income tax; reduce rate of tax (GA HB1001)

[DTrim99]

Bill Review: Georgia Income Tax Rate Cut (HB1001)

Reform ID: ga-hb1001 | State: GA
Bill text: https://www.legis.ga.gov/legislation/72294
Description: Accelerates Georgia's income tax rate reduction to 4.99% starting in 2026. Removes the revenue trigger conditions that could delay the reduction. We do not model the reduction in corporate tax rate to 4.99% in this analysis.

Merging this PR will publish the bill to the dashboard.

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What we model

Provision	Parameter	Current	Proposed
Georgia Income Tax Rate	gov.states.ga.tax.income.main.{filing}.brackets[*].rate	5.19%	4.99%

All 5 filing statuses × 6 brackets = 30 parameters are set to 0.0499.

Validation

External estimates

Source	Estimate	Period	Link
Georgia OPB Fiscal Note	~$778M revenue loss	Annual	Fiscal Notes
GA Budget and Policy Institute	~$776M	Annual	Breaking the Bank

Back-of-envelope check

Rate change: 5.19% → 4.99% = 0.20pp reduction
Georgia PIT base ≈ $16.2B → (0.20/5.19) × $16.2B ≈ $624M
(Difference from OPB's $778M likely due to behavioral effects and growth projections)

PE vs External comparison

Source	Estimate	vs PE	Difference
PE (PolicyEngine)	-$668M	—	—
Back-of-envelope	-$624M	+7.0%	Excellent
OPB Fiscal Note	-$778M	-14.2%	Acceptable

Verdict: PE estimate (-$668M) closely matches the back-of-envelope calculation and is within 14% of the OPB fiscal note.

Parameter changes

Parameter	Period	Value	Bill Reference
gov.states.ga.tax.income.main.single.brackets[0-5].rate	2026-01-01.2100-12-31	0.0499 (4.99%)	Section 1, amending O.C.G.A. § 48-7-20(a.1)
gov.states.ga.tax.income.main.joint.brackets[0-5].rate	2026-01-01.2100-12-31	0.0499 (4.99%)	Section 1, amending O.C.G.A. § 48-7-20(a.1)
gov.states.ga.tax.income.main.separate.brackets[0-5].rate	2026-01-01.2100-12-31	0.0499 (4.99%)	Section 1, amending O.C.G.A. § 48-7-20(a.1)
gov.states.ga.tax.income.main.head_of_household.brackets[0-5].rate	2026-01-01.2100-12-31	0.0499 (4.99%)	Section 1, amending O.C.G.A. § 48-7-20(a.1)
gov.states.ga.tax.income.main.surviving_spouse.brackets[0-5].rate	2026-01-01.2100-12-31	0.0499 (4.99%)	Section 1, amending O.C.G.A. § 48-7-20(a.1)

Key results

Metric	Value
Revenue impact	-$667,555,453
Poverty rate	24.74% → 24.73% (-0.01pp)
Child poverty rate	24.60% → 24.57% (-0.03pp)
Winners	39.5%
Losers	0.1%

Decile impact

Decile	Relative Change	Avg Benefit
1	0.023%	$4
2	0.048%	$18
3	0.052%	$27
4	0.058%	$37
5	0.064%	$48
6	0.080%	$72
7	0.093%	$100
8	0.091%	$119
9	0.115%	$195
10	0.230%	$1,564

District impacts

District	Avg Benefit	Winners	Losers	Poverty Change
GA-1	$131	38%	0%	0.00pp
GA-2	$79	33%	0%	0.00pp
GA-3	$160	39%	0%	0.00pp
GA-4	$234	42%	0%	-0.08pp
GA-5	$286	43%	0%	-0.38pp
GA-6	$214	43%	0%	-0.08pp
GA-7	$279	45%	0%	-0.11pp
GA-8	$103	35%	0%	0.00pp
GA-9	$108	38%	0%	0.00pp
GA-10	$143	40%	0%	0.00pp
GA-11	$339	45%	0%	-0.22pp
GA-12	$128	37%	0%	0.00pp
GA-13	$91	37%	0%	0.00pp
GA-14	$129	39%	0%	0.00pp

Reform parameters JSON

{
  "gov.states.ga.tax.income.main.single.brackets[0].rate": {"2026-01-01.2100-12-31": 0.0499},
  "gov.states.ga.tax.income.main.single.brackets[1].rate": {"2026-01-01.2100-12-31": 0.0499},
  "gov.states.ga.tax.income.main.single.brackets[2].rate": {"2026-01-01.2100-12-31": 0.0499},
  "gov.states.ga.tax.income.main.single.brackets[3].rate": {"2026-01-01.2100-12-31": 0.0499},
  "gov.states.ga.tax.income.main.single.brackets[4].rate": {"2026-01-01.2100-12-31": 0.0499},
  "gov.states.ga.tax.income.main.single.brackets[5].rate": {"2026-01-01.2100-12-31": 0.0499},
  "gov.states.ga.tax.income.main.joint.brackets[0].rate": {"2026-01-01.2100-12-31": 0.0499},
  "gov.states.ga.tax.income.main.joint.brackets[1].rate": {"2026-01-01.2100-12-31": 0.0499},
  "gov.states.ga.tax.income.main.joint.brackets[2].rate": {"2026-01-01.2100-12-31": 0.0499},
  "gov.states.ga.tax.income.main.joint.brackets[3].rate": {"2026-01-01.2100-12-31": 0.0499},
  "gov.states.ga.tax.income.main.joint.brackets[4].rate": {"2026-01-01.2100-12-31": 0.0499},
  "gov.states.ga.tax.income.main.joint.brackets[5].rate": {"2026-01-01.2100-12-31": 0.0499},
  "gov.states.ga.tax.income.main.separate.brackets[0].rate": {"2026-01-01.2100-12-31": 0.0499},
  "gov.states.ga.tax.income.main.separate.brackets[1].rate": {"2026-01-01.2100-12-31": 0.0499},
  "gov.states.ga.tax.income.main.separate.brackets[2].rate": {"2026-01-01.2100-12-31": 0.0499},
  "gov.states.ga.tax.income.main.separate.brackets[3].rate": {"2026-01-01.2100-12-31": 0.0499},
  "gov.states.ga.tax.income.main.separate.brackets[4].rate": {"2026-01-01.2100-12-31": 0.0499},
  "gov.states.ga.tax.income.main.separate.brackets[5].rate": {"2026-01-01.2100-12-31": 0.0499},
  "gov.states.ga.tax.income.main.head_of_household.brackets[0].rate": {"2026-01-01.2100-12-31": 0.0499},
  "gov.states.ga.tax.income.main.head_of_household.brackets[1].rate": {"2026-01-01.2100-12-31": 0.0499},
  "gov.states.ga.tax.income.main.head_of_household.brackets[2].rate": {"2026-01-01.2100-12-31": 0.0499},
  "gov.states.ga.tax.income.main.head_of_household.brackets[3].rate": {"2026-01-01.2100-12-31": 0.0499},
  "gov.states.ga.tax.income.main.head_of_household.brackets[4].rate": {"2026-01-01.2100-12-31": 0.0499},
  "gov.states.ga.tax.income.main.head_of_household.brackets[5].rate": {"2026-01-01.2100-12-31": 0.0499},
  "gov.states.ga.tax.income.main.surviving_spouse.brackets[0].rate": {"2026-01-01.2100-12-31": 0.0499},
  "gov.states.ga.tax.income.main.surviving_spouse.brackets[1].rate": {"2026-01-01.2100-12-31": 0.0499},
  "gov.states.ga.tax.income.main.surviving_spouse.brackets[2].rate": {"2026-01-01.2100-12-31": 0.0499},
  "gov.states.ga.tax.income.main.surviving_spouse.brackets[3].rate": {"2026-01-01.2100-12-31": 0.0499},
  "gov.states.ga.tax.income.main.surviving_spouse.brackets[4].rate": {"2026-01-01.2100-12-31": 0.0499},
  "gov.states.ga.tax.income.main.surviving_spouse.brackets[5].rate": {"2026-01-01.2100-12-31": 0.0499}
}

Versions

• PolicyEngine US: unknown (local dev)
• Dataset: policyengine-us-data v1.48.0
• Computed: 2026-03-04T19:24:59Z

🤖 Generated with Claude Code

[DTrim99]

Additional Analysis: Dual Baseline Comparison

Per reviewer request, computed impact against both baselines:

Revenue Impact by Baseline

Baseline	Rate Change	Revenue Impact
PE baseline (5.09% scheduled for 2026)	5.09% → 4.99% (0.10pp)	-$334M
Current 2025 law (5.19%)	5.19% → 4.99% (0.20pp)	-$668M

Breakdown

• Scheduled HB111 cut (5.19% → 5.09%): -$333M
• HB1001 acceleration (5.09% → 4.99%): -$334M
• Total = Full impact: -$667M

Comparison to External Estimates

Source	Estimate	PE Estimate	Difference
Georgia OPB Fiscal Note	~$778M	$668M	-14%
Back-of-envelope	~$624M	$668M	+7%

PE estimate is within reasonable range of external estimates. The 14% difference from the OPB fiscal note may be due to:

• Different data sources (CPS microdata vs state tax return data)
• Different projection methodologies
• Behavioral response assumptions

Database Updated

The model_notes field now contains impacts_by_baseline with both scenarios for display in the app.