Suspending certain taxes would incentivize social distancing, aid the needy
He’s presiding over a state rife with concern, and understandably so. Georgians are living under a state of emergency and are worried about their livelihood and at-risk loved ones. While Governor Kemp has already put his emergency powers to good use, taking impressive steps to buttress the state’s economy and keep Georgians healthy, his office should consider taking additional actions.
Americans have heard over and over again that social distancing and in some cases self-quarantining are the best tools we have to “flatten the curve” and get ahead of the coronavirus, and I believe this to be true. However, just recently, the U.S. Surgeon General tempered America’s expectations and stated that “Things are going to get worse before they get better,” in large part because many aren’t effectively practicing social distancing.
Indeed, we can do better. More Georgians ought to stay home, telecommute, use telemedicine for nonemergency issues, and rely on companies to delivery groceries, meals from restaurants, and other necessities. Taking these steps would go a long way toward flattening the curve, but we face a few obstacles here in Georgia.
Without instituting martial law, which I don’t support, or unilaterally shutting down many businesses, the only way to get people to increasingly rely on delivery and shipping services is to incentivize their use. Yet, many of these delivery companies are app-based services that, as of April 1, will be subject to Georgia’s new marketplace facilitator law, which aims to ensure that the state collects sales taxes from such services.
Because of this, some customers could witness an 8.9 percent tax tacked onto these services in locales like Atlanta. During a pandemic this places an undue burden on the many people who are struggling financially. In fact, unemployment claims are surging at a shocking rate. Myriad industries are hurting right now and have laid off employees or put them on unpaid leave – making it harder for them to provide for their families. What’s more, the increased prices of delivered products could disincentive people from staying home and encourage them to venture out in public in search of them.
Taxes are part of normal life, but we aren’t living in normal times. As such, until normalcy returns (and it will), Governor Kemp should consider delaying the implementation of the marketplace facilitator tax law and temporarily suspend any other sales taxes on app-based/internet purchases and on other merchants that deliver necessities. This will encourage Georgians to stay indoors, help those who are in need, and aid local merchants. The Governor has this power too.
It seems that Governor Kemp could invoke his nonemergency powers found in § 45-12-22, which authorizes the Governor to “suspend the collection of taxes, or any part thereof, due the state until the meeting of the next General Assembly but no longer; but he shall not otherwise interfere with the collection of taxes.” Or, Governor Kemp could rely on his broad emergency powers under § 38-3-51, which empowers him to “Suspend any regulatory statute prescribing the procedures for conduct of state business, or the orders, rules, or regulations of any state agency, if strict compliance with any statute, order, rule, or regulation would in any way prevent, hinder, or delay necessary action in coping with the emergency or disaster.”
Regardless of what statute Kemp cites, temporarily stopping the collection of specific taxes and deferring the implementation of new tax statutes that disincentive social distancing could have a positive impact on Georgians’ well-being. This isn’t a call to abolish these taxes – far from it. Collecting taxes is one of the modern state’s primary functions and they help pay for many of the services that we take for granted (even though in some cases the private sector could probably do a better job).
However, many of the services that will be covered as of April 1 due to the marketplace facilitator law weren’t being taxed as such before, which means that postponing its implementation would be the same as maintaining the status quo for a little longer. As result, Governor Kemp should explore the case for postponing new tax paradigms and as well as current taxes that may lead to adverse health outcomes until the pandemic dissipates.
