Car tax change leaves county flustered - WALB.com, Albany News, Weather, Sports

Car tax change leaves county flustered

May 23, 2005

Albany -- Millions of dollars for local governments could be at stake, as Georgia law changes the way car sales tax money is collected. Dougherty County Commissioners are upset about that new state law, which could be a boon for small counties, at the expense of larger shopping markets.

As Autorow begins to take shape on East Oglethorpe, Dougherty County Commissioners are crying foul over a new state law. "It's like changing the rules during half time in a football game, and nobody knows it but the referees," said Dougherty Co. Commissioner Lamar Hudgins.

Georgia House Bill 22 says local sales tax on car sales will go to the county where the buyer lives, not to the county where the car is bought. Dougherty County knows big money is at stake. "Six and a half million dollars," Hudgins said.

That's how much Dougherty County collected in car sales local tax last year. Now the money spent building Autorow could be wasted. Hudgins said, "We're concerned because we've invested thousands of dollars in Dougherty County to keep our car dealers here."

Large counties with lots of car dealerships could lose, while small counties without car dealers could get a bonanza. State Senator Joseph Carter said, "They probably will stand to benefit from that. The argument is that it somewhat levels the playing field."

Hudgins says another reason they are upset, state legislators did no study on the issue. "We didn't even know about it until it had became law." Now County officials are in the dark, how it will affect their budgets.

Hudgins said "We don't really know. That's a big question mark, and that's the concern. Obviously the state wasn't too interested in how much we would lose."

Over the next year counties will have to discover if more of their resident buy cars locally, or travel to other cities to buy, and how the tax dollars will flow.

State Senator Joseph Carter admits legislators are already backpedaling from the change. "I think this is probably going to be an issue where we just got to back up 12 months from now, and see how it actually plays out."

State legislators say the smaller counties need the revenue base. Dougherty County officials sympathize, but now wonder if the money they invested in Autorow was for nothing.

The state collects four percent of the cost of a car in sales tax money, while the county can charge up to three percent. Dougherty County receives 40 percent of that local sales tax, while the City of Albany gets 60 percent.

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