New restrictions on how Habersham County Commissioners and School Board members can spend your tax dollars passed the Georgia House today.
House Bill 170 is designed to secure about $900 million dollars for the state’s roads and other transportation needs. A recent Department of Transportation study concluded that Georgia needs to spend more than $1 billion more per year just to maintain the transportation system we already have.
Lawmakers want to get some of that extra money by siphoning it away from city and county governments that currently use local sales taxes collected at the pump as part of their general funds. Under HB 170, any money collected on the sale of gasoline must be used to pay for transportation.
In exchange for that lost revenue, the state will allow local governments to increase the amount of special purpose local sales taxes from 1% to 1.25% which would mean higher taxes on almost all goods purchased if approved.
Currently the state uses a mix of sales taxes and an excise charge which means the taxes you pay per gallon go up or down depending on the price. Under HB 170, the sales tax goes away and you pay the same 29.2 cents per gallon no matter the price. In those counties without local sales tax it will mean a tax increase.
HB 170 passed the Georgia House by a vote of 123-45 after lengthy debate Thursday. It now goes to the Georgia Senate. Both Habersham County representatives, Dan Gasaway and Terry Rogers, voted in favor of the plan.
New rules under HB 170
- Gas taxes must be spent on roads and transportation.
Supporters estimate that approximately $180 million in state gasoline taxes and $500 million in local gasoline taxes are diverted into state and local general funds each year and are not exclusively used for transportation. - Future SPLOST and E-SPLOST taxes on gas must be spent on roads and transportation
Current local penny taxes won’t change but future local tax efforts must use pennies collected from fuel sales to support transportation projects. - Future SPLOST, LOST, E-SPLOST, HOST, and MOST taxes could go up
Currently restricted to a single penny (or 1%) on each dollar spent, new local taxes can be up to 1.25% on each dollar to make up for the fuel taxes lost to local governments. - Replaces gas sales tax with an excise tax
Currently you pay a .04 cent state sales tax/.07 cent excise tax per gallon. The new bill combines all the current sales taxes and converts it to a flat 29.2 cent excise tax per gallon. That’s an overall increase of 11.7 cents per gallon. The Senate version of the bill would phase that in over three years. - No more “Gas Tax Holidays”
In recent years, as gas prices reached higher and higher, Georgia governors have suspended the collection of motor fuel taxes to help the economy. HB 170 will limit that power to “declared states of emergency” only. - Removes the tax credit for low-emission vehicles
Currently the state gives folks tax breaks of $2500 for buying hybrids and $5000 for electric vehicle purchases. The bill will remove those incentives. - New tax on electric vehicles
Folks who don’t use gas in their cars will still have to pay $200 dollars in gas taxes (although the bill terms it a “user fee”). The tax on non-gas powered commercial vehicles will be $300.
