ATLANTA — Governor Brian Kemp of Georgia is advocating for an accelerated pace of state income tax reductions and warns that he may summon lawmakers for a special session later this year if necessary to advance his objective of capping lawsuit awards.
In his seventh annual State of the State address delivered on Thursday, Kemp’s commentary centered primarily on the recovery from Hurricane Helene, while offering fewer specific policy initiatives than in previous years. A significant portion of his speech was dedicated to his case for limiting lawsuits, highlighting it as a crucial government reform.
On January 1, Georgia’s flat income tax rate was decreased to 5.29%. A law enacted in 2022 abolished the previous bracket system and initiated a series of planned annual reductions of 0.1%, aimed at eventually reaching 4.99%. Citing the state’s consistent budget surpluses due to a robust economy and effective spending management, Kemp, along with Republican lawmakers, is advocating for more substantial cuts to the income tax before the annual schedule, proposing a reduction to 5.19% on all taxable income for the year 2025.
Kemp emphasized, “At the end of the day, that’s your money — not the government’s. Here in Georgia, we believe you should keep more of it.” This proposed adjustment would result in an estimated $149 million decrease in state revenue for the budget year ending June 30, with a projected annual revenue loss of approximately $744 million thereafter. For the average taxpayer, the impact would be modest; for instance, an individual earning $44,000 annually would save around $30.
These plans are in addition to the third wave of income tax refunds that Kemp and legislative leaders have promised. Under the current plan, refunds would again be available, offering up to $250 for individual taxpayers, up to $375 for head-of-household filers with dependents, and up to $500 for married couples filing jointly. This initiative would utilize part of Georgia’s substantial $11 billion surplus to distribute approximately $1 billion in rebates.
Despite his push for reforms, Kemp did not provide specifics regarding his proposed changes to the civil lawsuit process, often referred to as “tort reform.” A spokesperson for Kemp indicated that detailed proposals would be forthcoming later this month. However, the signal of a potentially contentious special session indicates the complexity of the matter at hand.
“I understand this issue is complicated and will not be easy to rectify,” said Kemp. “There are numerous stakeholders with varying opinions on how to proceed. Nevertheless, inaction is no longer a viable option.”
Kemp’s agenda predominantly focuses on spending interventions, including $600 million allocated for enhancing prison conditions and $50 million earmarked for school safety initiatives. The brevity of his proposal list also reflects an acknowledgment of his current status as a lame-duck governor, with contenders already positioning themselves for the upcoming 2026 election. Traditionally, governors in their second term dedicate their efforts to solidifying their accomplishments and reinforcing ongoing projects rather than introducing new policies.
The future of Kemp’s own political trajectory remains uncertain. He has utilized campaign funds to bolster his influence for the 2024 elections, subsequently aiding candidates for the legislature and playing a pivotal role in helping Donald Trump reclaim Georgia for the Republican Party.
Kemp currently leads the Republican Governor’s Association and many are speculating that he may run for the U.S. Senate in 2026 against first-term Democratic incumbent Jon Ossoff. However, no official plans have been disclosed, and Kemp may also choose to pursue a presidential campaign in 2028, contingent on the state of his relationship with Trump, which has been tumultuous.
In his recent address, Kemp only briefly referenced Trump, thanking both him and Biden for their support in federal relief efforts following Hurricane Helene. Unlike his previous speeches, this address largely avoided party politics, recognizing that bipartisan support may be essential for enacting lawsuit reform. The governor made a specific appeal to Democrats, stating, “There is no reason we can’t tackle tort reform together,” as he recalled their collaborative effort in passing an anti-hate crime law following the tragic killing of Ahmaud Arbery in 2020.
