News and Insights

Georgia Tax Reform Study Commission Examines State Revenue Sources

Tax Development Jul 19, 2006

The second meeting of the Georgia Tax Reform Study Commission ("Commission") was held Thursday July 13, 2006 at the Joe B. Adams Conference Center in Camilla, Georgia, led by Representative Richard Royal. With the goal of modernizing and revitalizing the Georgia revenue structure, the Commission continued to seek solutions that could enhance and/or create an equitable and flexible tax system for Georgia. Through presentations and Q&A sessions, the event provided an opportunity for the Commission to explore Georgia’s revenue sources and the impact tax reform would have on those sources. Commission members examined all taxes including fees, fines, and permits that are outside the sphere of the traditional property and sales tax revenue sources.

The Commission, established through HR 1464, is seeking to relieve the current strain on Georgia’s tax system by attempting to reconcile the increased demand for state services with the conflicting desire for tax relief. The Commission believes their efforts will allow Georgia to respond to current and future fiscal needs in a more balanced, equitable fashion.

The Commission and attendees heard presentations from the Association of County Commissioners of Georgia (ACCG) who requested empowerment from lawmakers to have more flexibility with regards to how they administer local taxes within their respective jurisdictions. Currently, the Local Option Sales Tax (LOST) in Georgia is administered through negotiated contracts with the local jurisdictions, which are up for renegotiation every ten years along with the Special Purpose Local Option Sales Tax (SPLOST), which is negotiated every five to seven years.

The Commission and attendees were also introduced to Tax Expenditure Data (T.E.D.), compliments of the Carl Vinson Institute ("Institute"). T.E.D. is a powerful government research database hosted and maintained by the Institute, which allows users to access and analyze government operating expense data. This powerful financial management tool allows the research and comparison of government financial data between cities and counties throughout the State of Georgia. T.E.D. provides government operating expense data, not capital outlays. The database captures the data submitted to the Georgia Department of Revenue ("Department"), the Department of Community Affairs, and the Department of Audits and Accounts, which local governments are required to submit on an annual basis. No separate forms are required to capture data. 

The Department identified revenue sources within the Georgia tax revenue stream, while the Commission probed to better understand tax calculation methods. The Georgia School Board Association (GSBA) and the Georgia Municipal Association (GMA) also contributed to the insight of the Commission though presentations of their own.

The next meeting will see the Commission convene at Southern Poly Tech in Marietta, Georgia on Thursday, July 27, 2006 at 10:00 A.M. The meeting will be chaired by Representative Steve Tumlin and will focus on individuals and businesses that are failing to remit taxes due. The Commission is planning to meet twice during the month of August, once during the month of September, and once during the month of October. It is anticipated that these meetings will allow the completion of the Tax Reform Study Commission’s work.