Gov. Nathan Deal issued an executive order suspending collection of the state’s 4 percent sales and use tax on jet fuel, effective Aug. 1. In 2018, the state sales tax on jet fuel amounted to more than $39 million in revenue.
“Georgia imposes the fourth-highest fuel tax burden among states with major airport hubs, putting us at a daily disadvantage behind North Carolina, Texas, Florida and New York, among others. In fact, Georgia’s tax burden ranks only behind high-tax states California, Illinois and Michigan,” said Deal.
According to Deal, the annual economic impact of Georgia airports amounts to over $62 billion per year, and direct flights out of Hartsfield-Jackson Atlanta International Airport support nearly $11 billion in foreign investment and 42,000 jobs across the state.
Deal points to the elimination of the energy sales tax on manufacturers in 2012 as a key to job growth in the sector and says he is aiming to do the same for the airline industry with the elimination of the jet fuel tax.
“In the past five years, we’ve seen manufacturing jobs grow by 12.5 percent to a total of 395,807 in 2017. Just as removal of this tax burden spurred growth in the manufacturing arena, so will removal of the jet fuel tax burden in the airline industry,” Deal said.
Earlier this year, the state legislature was considering eliminating the jet fuel tax altogether, but scrapped those plans after Delta Airlines eliminated its discount for NRA members, angering many conservatives.
Deal’s executive order will remain in place until the legislature convenes again in January. By state law, the governor can suspend tax collections until the legislature is in session. The legislature could vote to eliminate the tax in 2019. If the legislature doesn’t act, the fate of the tax will be up to either Stacey Abrams or Brian Kemp, depending on who wins the gubernatorial race in November.