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AJC.com > Legislature > Blog > Archives > 2009 > February > 10 > Entry

House Dems see $1 billion in untapped sales tax

House Democratic leaders on Tuesday unveiled legislation that they claim would help the state rake in an estimated $1 billion in unpaid sales taxes.

The bill would streamline the way businesses report sales tax receipts to the Department of Revenue and how the agency sends that money back to local governments.

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Rep. Virgil Fludd (D-Tyrone) is the lead sponsor of HB 356. It transfers control for collecting sales taxes from DOR to local governments. Democrats said that Alabama has instituted a similar system and that it saw a $1 billion increase in revenue.

Fludd, House Minority Leader DuBose Porter (D-Dublin) and House Democratic Caucus chairman Calvin Smyre (D-Columbus) were joined by several other colleagues at a news conference to announce the plan Tuesday morning.

Fludd plans to speak from the well of the House today to urge bipartisan support — but whether that is on its way is unclear. The lawmakers said they would welcome Republican support, which is typically necessary for a bill to make it through the GOP-dominated General Assembly.

Under the plan, more businesses would report sales tax collections electronically. Businesses that report more than $5,000 a month in sales tax revenue already do that, but the legislation would lower that threshold to $1,000.

Porter and Fludd said businesses would have no upfront costs to participate. Fludd said the Department of Revenue has estimated that the state is losing $1.6 billion in uncollected sales and income taxes.

Caption: From left, Rep. DuBose Porter (D-Dublin), Rep. Calvin Smyre (D-Columbus), Rep. Nikki Randall (D-Macon) and Rep. Virgil Fludd (D-Tyrone).Photo credit: Aaron Gould Sheinin/asheinin@ajc.com

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