Tax reform could hurt county coffers

By Camie Young (3596)
camie.young@gwinnettdailypost.com

As of Saturday, March 31, 2012
© Copyright 2013 Gwinnett Daily Post

LAWRENCEVILLE -- As the saying goes, your wallet is safe; the Legislature is no longer in session.

This year's session of the Georgia General Assembly may have sounded good to taxpayers, especially the news that the so-called birthday tax on automobiles will end next year.

But local governments worry that coffers already ailing in a poor economy could be drained even further.

The impact, Gwinnett Commission Chairwoman Charlotte Nash, is hard to predict.

According to the legislation, which Gov. Nathan Deal is expected to sign, people will continue to pay the annual ad valorem tax until they buy a new car. At that time, they will pay a hefty one-time excise tax instead of the annual bill.

"We can tell you what we will lose from the shrinking base that will no longer take part in the ad valorem tax," she said, but the government is struggling to estimate revenues from the excise tax.

Plus, it is hard to predict how soon people will buy new cars.

"We still don't have a good feel for how fast vehicles come out of the digest," she said of the ad valorem taxes that bring in nearly $26 million to the government each year.

Sloan Roach, a spokeswoman for Gwinnett County Public Schools, said officials there believe the school system will break even in the first year or two of the change, which begins in March.

But they estimate the school system could lose a total accumulation of $100 million by the time a decade passes.

Both Nash and Roach noted that legislators pledged to keep the local governments whole in the process, but both said that is a promise they are unsure would be kept.

"It's not going to all happen at once, so that's a good thing," Nash said. "When you are making a big change with a big revenue source, it's good to have a chance to phase it in. (But) within a 10-year period, just about all of that will have disappeared."

County government officials were glad to see action on legislation to add penalties to metal thieves and on registeries for vacant and foreclosed properties, which did not interfere with a current Gwinnett registry.

Action by the legislature also saved Gwinnett for a number of regulations originally authored for Fulton County. The laws did not call the county by name but instead were limited to a certain size population, since Fulton was the largest in the state. But after the 2010 Census, Gwinnett met those population requirements and would have been subjected to the laws.

A proposed constitutional amendment placed on November ballots may have one of the biggest impacts on Gwinnett. GCPS officials lobbied against the bill, which would allow charter schools sanctioned by the state. But local school, Ivy Preparatory Academy, which lost its charter due to a Supreme Court ruling, could be saved by the passage.

More like this story

County budget proposal to be presented Tuesday ( November 24, 2012 )
BOC approves Partnership Gwinnett nonprofit ( November 27, 2012 )
County, cities weigh energy tax on manufacturers ( September 25, 2012 )
New car title tax begins March 1 ( February 23, 2013 )
GCPS appeal has charter head 'mad' ( May 14, 2010 )

NorcrossDot 1 year, 1 month ago

You now have a year to reduce you're unnecessary spending. By the sheer nature of being a government institution there are many, many, unnecessary and not you're job spending that can offset this.

So instead of bemoaning the issue start to work on them.

Besides I have noticed Gwinnett's finest are out in mass force (protecting us) by standing in turn lanes with their radar guns.

Remember private business had to do start their cuts 5 years ago.

roaads1 1 year, 1 month ago

It's about time Georgia got rid of Ad Valorem tax. Of course making people pay a higher tax on new cars will hurt new car sales. Can't they just do it right one time ?

R 1 year, 1 month ago

That's new and used including PRIVATE sales ... Surprise!

roaads1 1 year, 1 month ago

That's completely wrong. Why should we pay more than the states around us ?

BufordGuy 1 year, 1 month ago

The government losing money sounds like a good thing to me. Need to pass a law making the government pay for only the things for which governments are needed--public safety, water/sewer, and roads and we'd all be better off.

NorcrossDot 1 year, 1 month ago

Totally agree.

kevin 1 year, 1 month ago

write to your commissioner or to Ms. Nash with your complaints. They don't reflect your ideas, vote them out. Do you vote?

dentaldawg83 1 year, 1 month ago

all those poor unnecessary gov't admin staff folks should be worried..

Mack711 1 year, 1 month ago

One area to cut the overhead is the garbage tax. Each homeowner should be required to have garbage service of some kind. But let the homeowner select the company that they want and not have them county do it for us. After all the state lets us select our own insurance compamies for auto insurance. That is one way to reduce taxes on us, the taxpayer.

NorcrossDot 1 year, 1 month ago

Exactly - gov needs to reduce to what they were suppose to do. Then maybe, just maybe they could do one thing right!

kevin 1 year, 1 month ago

this is why we have elections, you throw out long-time politicians. Do you vote?

Jan 1 year, 1 month ago

It seems that most should do a little math. I did some quick calculations. People that buy cars for less than $28,572.00 would need to keep the car for about 8 years to break even on the tax, longer on cars that depreciate faster. I based this on the current 33.82 mill rate in unincorporated Gwinnett. There is a cap of $2000 on that initial tax which means those wealthy individuals that can most afford this tax, get a tax break. To clarify, Purchase a car for $28,572.00 and pay 7% extra tax. Buy a car for $57,144.00 and pay only 3.5% tax. This is not a fair tax. As pointed out above, this tax would also apply to car sales between individuals so the state collects an additional 7% of the value every time its registration changes hands. This is not abolishing a tax. It is trading a uniform tax for a extremely regressive, unfair tax. What about people that move to our state or out of our state? How can this be considered even slightly fair to this group?

NorcrossDot 1 year, 1 month ago

Agreed. Is this tax just on new cars? If so then I am safe. I never buy new cars. I let someone else take the 25% lost at the time of sale. I also drive my cars for as many year as they can make it. Did you really expect to get "fair" treatment from a government entity?

Jan 1 year, 1 month ago

I have not read the bill yet, but every source that I found said that used cars, even person to person sales, would be required to pay the tax. This tax was also stated to be 7% (not to exceed $2,000) not 25%.

BufordGuy 1 year, 1 month ago

Sounds to me that is the only fair tax I've seen. Taxes should not be used to punish you for being successful and able to buy more. They should punish you for being lazy and unwilling to work hard to afford more AND be more of a burden on the system.

Jan 1 year, 1 month ago

How is it fair to tax those that buy the oversize, gas guzzling, polluting vehicles at a lower rate? If anything, those purchasing lower polluting vehicles with high miles per gallon, such as the Volt, Leaf, Focus and Prius, should get the tax breaks. These owners are doing something to help us get off of foreign oil and get our pollution under control.

Oliver 1 year, 1 month ago

Does that mean we should tax Obama at a higher rate since he refuses to do things which will increase domestic oil production??

And which part of increased coal burning and/or nuclear energy to satisfy increased electricity needs gets "our pollution under control"?

FordGalaxy 1 year, 1 month ago

Jan, in all fairness, you're talking about a government that classified carbon dioxide as a pollutant. Do you know what you exhale? Carbon Dioxide. So to our government, the mere act of breathing is polluting. And say what you will about SUVs versus these eco-friendly smart cars...I'd rather be blindsided in an SUV than blindsided in a Prius. Which do you think is safer for the occupants?

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