ATLANTA -- A widely watched Georgia legislative study group may soon recommend sweeping reforms of the state's tax system, according to the group's co-chairman.

State Sen. Terrell Starr said the Joint Commission on Revenue Structure may, within the next two weeks, endorse broadening and raising the sales taxes while lowering property taxes and eliminating personal income taxes imposed on some low-income households.

However, the Forest Park Democrat, who also serves as vice-chairman of the Senate Appropriations Committee, said he expects strong opposition to such recommendations when the legislature convenes in January.

"We need a more lasting, more progressive tax structure," Starr said Monday in an interview. But "I'm about convinced the proposals are not going to work," he added, noting that Gov. Zell Miller is expected to fight any proposed increase in the sales tax.

Miller, a Democrat who was reelected to a second term on Nov. 8, promised during his campaign to resist any tax increases.

Stressing the group's insistence that tax reform be revenue neutral, Starr said it has considered proposing that the state's sales tax be raised by a penny -- to seven cents on the dollar -- to offset envisioned tax cuts.

Starr also expects the commission to propose broadening the state's sales tax base to include services.

"The taxing system needs to reflect the change from a manufacturing base to a service base," he said.

State officials estimate that Georgia collected $3.14 billion in state sales taxes during the 1994 fiscal year, which ended June 30. For the current fiscal year, officials expect $3.47 billion for the levy.

Imposing sales taxes on a "consortium of services" not now subject to the levy could yield up to $300 million for the state, and $75 million for local governments, according to a legislative source.

The commission also looked into adjusting the current state income tax brackets, which have not been changed since 1937, according to Starr. "Our [state] tax brackets need to be broadened to tie in with federal guidelines," he said.

About 200,000 residents would not need to file returns if the state tracked current federal income tax rules, Starr said. "This would remove the low-income filers, those we want to affect, off the roll," said the Democratic senator.

Starr said that Miller's campaign promise to remove the 4% state sales tax on groceries would not be supported by the commission. The governor intends to remove 1% each year over a four year period.

Sen. Starr, who once supported the measure, said: "Removal of the tax doesn't reach low income people."

Rob Rickles, a spokesman for the governor, said yesterday that Miller wants to see the commission's final proposals before commenting. Rickles said the governor stands by his commitment to reduce the sales tax on foods.

The commission, which was established in 1991, has planned to dissolve at the end of December. Starr said it will vote on final proposals on Dec. 12.

Starr co-chairs the commission with Speaker of the House Thomas Murphy, who is also a Democrat. Murphy could not be reached for comment.

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