In Georgia, the promise of new jobs has fueled a major corporate tax overhaul. By 2008, Georgia companies will only pay state taxes on what they earn from sales. A simpler system could mean more jobs.
For years, taxes on Georgia businesses were based on a complicated formula. The General Assembly has made that formula history, and replaced it with a system that will only tax businesses on what they actually sell.
Jud Rackley, an accountant, says, "It's estimated that Coca-Cola's annual savings will be $750,000 in income taxes, so for smaller companies, the savings will be less and it may take them a longer period of time to use the tax savings to really move forward and expand."
Business executives say this new tax change will not just benefit companies based here in the Peach State. In fact, they say it will go a long way into helping create many new jobs.
Rusty Griffin, a business expert, says, "It will be a big boost to improving employment, not just employment for minimum wage either, for some higher paying jobs, which is really what we need in Georgia, and more specifically what we need in south Georgia, jobs that improve the quality of living and standard of life."
With the change, Georgia joins just eight other states nationwide with this type of tax system.
Rackley says, "This could also be an enticement to businesses that aren't here to consider relocating to the Peach State."
Business leaders say that means more jobs and opportunity, all because of a tax change.
The change in Georgia's corporate tax code is expected to bring more money into the state because it also closes several loopholes where companies could avoid paying their full tax bill.