Georgia County Government - September 2008 - (Page 9)

CountyMatters More Local Control Over Sales Taxes S By Jerry Griffin Executive Director ales taxes have generally been more popular with the public than property taxes. This is probably due to the fact that sales taxes are paid in small increments and that people feel like there is some choice retained in paying the tax, unlike property taxes that come in one or two lump sum payments near Christmas and ultimately can take away the right of property ownership if the tax is not paid. The main disadvantage to the sales tax is that the revenues are more volatile and the collection rate is usually lower than property tax. As local governments continue to place more reliance on sales tax revenues, it becomes increasingly important to manage the volatility and increase collection compliance. This year the State Senate passed S.R. 1167, which sets up a study committee to look more closely at ways to improve local sales tax collections. Sen. Chip Rogers is the chair of the study committee, and commissioners Tom McMichael, Houston County, and Lamar Paris, Union County, are serving on the advisory council representing county governments. The study committee met for the first time in Savannah on June 25. At this meeting, the committee heard from Alabama representatives that discussed the benefits Alabama counties have received by collecting their own sales tax. In many cases they claim to have increased sales tax revenues by up to 20 percent due to the local government’s ability to monitor and audit sales tax collections within its borders. Right now in Georgia, counties do not have the option to collect their own sales tax. All sales tax is collected by the Department of Revenue and the local portion is remitted back to the local governments. One percent of all local sales taxes collected are retained by the state as an administrative fee. Unfortunately, this money goes into the state treasury, and only a portion is allocated back to the Department of Revenue to pay for the staff needed to audit and collect the local tax. This has resulted in Georgia having one of the lowest audits to vendor ratios in the country. Many counties and cities have expressed an interest in helping the state audit the businesses in their jurisdiction, but state confidentiality laws do not allow the locals to participate in the audit process and greatly limit the amount of information local governments can receive about their sales tax collections. In addition to looking at whether local governments should have the option to collect their own sales tax, the committee will be considering other proposals to increase collection compliance and ensure the revenue gets back to correct jurisdiction to be used for the purpose it was approved for in the local election. MATTERS continued on page 10 In Georgia, counties do not have the option to collect their own sales tax. All sales tax is collected by the Department of Revenue and the local portion is remitted back to the local governments. SEPTEMBER 2008 www.accg.org 9 http://www.accg.org

Table of Contents Feed for the Digital Edition of Georgia County Government - September 2008

Georgia County Government - September 2008 Contents President’s Message County Matters Cobb County: Quality of Life is Job No. 1 Innovative Transportation Financing in Georgia Drive Your Fleet into the Next Generation of Efficiency, Profits Spotlight: Georgia Technology Authority Media Productions GEMA News: Hurricane Season Could Cause Natural Gas Spike GDEcD News: Communities Receive Funds to Develop Tourism Assets Georgia’s Grand Old Courthouses: Upson County Extension News: Radon: Georgia’s Silent Danger Research Corner: Conserving Fuel Costs in Your County Staff News County Parade Index of Advertisers

Georgia County Government - September 2008

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