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Georgia approval of state tax court is big news

Hero Background Solutions North America

Interesting, eventful stories are often obscured by larger narratives.   

While most indirect tax leaders, along with the rest of the world, watched the results of the U.S. presidential and congressional elections in early November, a momentous, tax-related ballot initiative quietly received voter approval in Georgia on Election Day.

Amendment 2 on the Georgia ballot establishes the Georgia Tax Court as a specialized judicial body with statewide jurisdiction and authority equal to superior courts with the state’s judicial branch concerning tax matters. This authority is crucial in that it distinguishes the Georgia Tax Court from the Georgia tax tribunal (which operates in the state’s executive branch) that it replaces.   

According to the amendment, Georgia Tax Court judges will be appointed by the state’s governor (subject to approval by the state’s Senate and House Judiciary Committees) to fulfill four-year terms. Judges will have the flexibility to conduct pretrial proceedings in any county, and the tax court will be part of Georgia's constitutional court system alongside other specialized courts like the state-wide business court.

As of 2020, 35 states had a tax tribunal. However, 29 of those tribunals are part of their state’s executive branch while only six are part of the state’s judicial branch. (These figures are likely sourced from the AICPA, which tracks state tax tribunals and the extent to which they allow CPAs to represent taxpayers in all tax matters before an independent tax forum.)

Georgia’s ballot initiative began as a legislative proposal to amend Georgia’s constitution so that the state tax court could be created. The proposal attracted broad bipartisan support; it received only a single dissenting vote during its passage by Georgia’s legislature. The Metro Atlanta Chamber strongly advocated for the amendment, which it helped draft. 

In a pre-election article for Law.com, legal reporter Thomas Spigolon highlighted several benefits promoted by the amendment's supporters. These included improved access and efficiency with hearings near plaintiffs’ offices, the tax court’s jurisdiction over constitutional issues, and Georgia gaining a competitive edge in attracting employers. Opponents of the proposal pointed to implementation costs and also questioned whether the previous tribunal systems needed to be replaced. 

Georgia’s electorate sided with the proponents. This makes for a great story with positive implications on companies that operate in states that have yet to create a dedicated tax court -- as I explain here. 

Explore more resources from our industry influencers:

Michael J. Bernard, Chief Tax Officer – Transaction Tax at Vertex Inc. Vertex's Chief Tax Office (CTO) provides insight regarding the impact of tax regulations, policy, enforcement, and emerging technology trends on global tax department operations.

Michael J. Bernard

Chief Tax Officer, Transaction Tax

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Michael Bernard is the Chief Tax Officer of Transaction Tax. In his role, he provides insight and thought leadership around tax department operations, U.S. indirect tax, tax risk management, and tax policy, as well as emerging tax trends. He is an executive-level tax attorney with a diverse portfolio of experience in corporate tax, administration, and finance, including a substantive knowledge of U.S. and international tax laws.

Prior to joining Vertex, Michael was in various tax leadership roles at Microsoft Corporation for 28 years, the most recent being Senior Director – Tax Counsel. Michael led teams in the following functional areas: direct and indirect tax controversy, sales and use, business license, property, tax IT, SOX, and telecommunications. He also co-led a corporate taxpayer advocacy group with the Washington Department of Revenue and was a Director on the Board of the Washington Research Council. Michael has also testified before administrative and lawmakers at both the federal and state level.

Michael earned both a J.D. and a Bachelor of Science in Business Administration from Creighton University. He is a part-time lecturer of Law in the LLM program at the University of Washington School of Law. Michael also served on the board of directors, executive committee, and chaired committees for The Tax Executives Institute (TEI) for nearly 25 years.

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