CONYERS -- Democratic candidate for Georgia governor DuBose Porter said his proposal to collect sales taxes from "cheaters" could reap millions for the strapped state budget and questioned why current state leaders have failed to act on it rather than offer new cuts.
Speaking to the Rockdale County Bar Association on Friday, Porter said his proposal is similar to what has been done in Alabama, where officials sought to collect state sales taxes that were not being paid by businesses. He said the effort added $1 billion to Alabama coffers.
The proposal would allow a sharing of information between the state Department of Revenue and county governments to match state sales tax certificates with local business licenses.
"I say before we start cutting education and raising taxes, let's get what we should get from the cheaters," Porter said. "This would be a GPS system telling you who's cheating."
As the state minority leader in the Georgia House, Porter, D-Dublin, got a pilot project done in Hall and Lowndes counties last year that showed that a quarter of all business license-holders had not paid sales taxes. The proposal is now in the General Assembly as House Bill 1137.
Porter added the state's Department of Revenue had been against the proposal. "Either they are incompetent, hiding something or protecting somebody. I don't know," he said.
Porter said the proposal could also help counties in finding businesses that have a sales tax certificate but not a business license.
In an editorial to the Atlanta Journal-Constitution, Department of Revenue Commissioner Bart Graham discounted Porter's amount of $1 billion lost from cheaters. Also, Graham countered that part of Porter's proposal that would allow counties to privatize tax collections would expose a businesses' tax records.
Porter said during Friday's luncheon that the Department of Revenue under its current system is unable to account for sales tax collections that exceed what was designated for the counties in local sales tax revenue receipts. Now, any unaccounted sales tax received is put into the state's treasury. Porter said that while the state gets its 4 percent of sales tax, the counties with their 1 percent sales taxes are the ones that suffer from the loss of unaccounted tax revenue.
Porter also offered a proposal to dedicate 1 percent of state sales tax to leverage federal money for transportation projects. He noted that Georgia has received $750 million in federal dollars for transportation while North Carolina has received more than $1 billion that is being used to fund rapid rail from Charlotte to the Research Triangle at Raleigh.
"That's just shameful," he said. "We don't get the federal money that we need because we don't have that dedicated source of local funding to go toward transportation."
On education, Porter said he would allow HOPE scholarship funds to go toward joint enrollment of high school juniors and seniors to take technical school classes. He reasoned that jobs that require only a high school diploma are gone. "They've gone to Mexico and China, and we have to realize that for the economic development of Georgia we have to graduate kids with a skill."