ATLANTA (AP) State transportation officials hope new
legislation will allow the state to collect millions of dollars
in gasoline taxes that are lost to fraud and mistakes each
Beginning in this month, all of Georgia's approximately 12-cents-per-gallon
gasoline tax will be collected by the state's 350 wholesale
distributors when they sell tankerloads of fuel to retail
Lawmakers estimate that will increase collections by as much
as $20 million a year.
For years, nearly 5 cents of the gasoline tax, which brings
the state about $700 million a year, has been collected by
State Department of Transportation officials say there are
flaws in that system.
Truckers burn untaxed fuel meant for off-road vehicles in
their on-the-road big rigs. Gas station owners shave gallons
off their tax returns. Bootlegging distributors purchase fuel
in Georgia and report selling it to retailers here, but actually
sell it in neighboring states with higher gas taxes and pocket
Others simply make mistakes that go unnoticed.
When the General Assembly convenes next month, the DOT will
push for more legislation in an effort to increase collections
further. But opposition within the motor fuel industry and
state revenue officials may undercut the proposal.
Opponents say the DOT should give the new gas tax collection
system, enacted during the last legislative session, time
to work before pushing for more changes.
DOT officials believe it is best to move all collections
to the terminal, where fuel is pulled from a refinery's pipeline
and loaded onto distributors' tanker trucks.
"We ought to be able to account for almost 100 percent,"
said Earl Mahfuz, treasurer of the DOT.
If it started collecting at the state's 45 terminals, Georgia
would join 21 states that now collect gasoline taxes either
at the terminal or as soon as gasoline shipments arrive within
their borders. Georgia and Alabama are the only Southeastern
states that have not made the change.
Fuel distributors are expected to oppose taxing at the terminal.
Distributors get 20 days to turn over collected taxes to
the state Revenue Department. This lag, referred to in the
business as the "float," has become important for
distributors. They can use the short-term, interest-free cash
to pay for new product, explained Roger Lane, president of
the Georgia Oilmen's Association, which represents distributors.
The association lobbied to shift tax collections away from
retail gas stations. But Lane said it opposes shifting collections
higher up the distribution chain without some concessions.
"It would take cash flow from the distributor, and they're
struggling to survive now," he said.
The state also compensates distributors for acting as the
Revenue Department's surrogate tax collector. They get to
keep 1 percent of the first 5.5 cents tax on every gallon
they collect. During the past budget year, which ended in
June, the state paid out $3.6 million in compensation to distributors.
Transportation Commissioner Harold Linnenkohl said the distributors
no longer would bear the costs associated with collecting
the taxes, so they would not need the compensation. And he
dismissed the distributors' concern about the float.
"The state should not be fronting their businesses,"
Linnenkohl said the proposal to collect taxes at the terminal
could take a couple of legislative sessions to gain momentum,
considering the opposition from the distributors and the Revenue
The Revenue Department is still training distributors to
use the new collection system. And the process would have
to be revamped a second time if legislators again shift the
tax collection point.