Newspaper Page Text
Spelman Spotlight September 24, 1979 Page 4
Students to Vole on Local Tax
By Pamela Denise Moore
and
Kiron Kanina Skinner
On October 2, 1979, students
and citizens of Atlanta will have
the opportunity to vote on the
local option sales tax.
The outcome of this referen
dum determines whether Fulton
County’s sales taxes will be raised
from four cents to five cents per
dollar. Revenues generated by
the one percent increase in the
sales tax would go to ten
municipalities in the county.
Atlanta would receive about 54
percent of the revenues which
amounts to about 24 million
dollars.
The imposition of a one per
cent sales tax by counties and
cities is allowed by the Georgia
Retailer’s and Consumer’s Sales
and Use Tax Act as amended in
March 1979. The tax would apply
to all goods and services covered
by the existing sales tax, which
also includes gasoline.
The law, however, also
requires that counties and cities
hold a referendum to allow voters
to approve or disapprove im
position of the one percent sales
tax.
The most controversial aspect
of this law is that section which
requires the city and county to
reduce property tax rates each
year by a rate that is equivalent to
revenues generated by the sales
tax during the preceding year.
The Pros
?_ The local option sales tax
will increase City revenues in the
short run by providing the City
with needed additional operating
funds in 1980 (the year of double
taxation) and in the long run by
supplementing the City’s proper
ty tax base with a faster growing
base—retail prices.
• Fulton County property
taxes are excessive in comparison
with surrounding counties in
Atlanta’s metropolitan area.
• A large number of property
holders are not wealthy but may
receive benefits from the sales
tax.
•_ The tax on property will
continue to provide the largest
share of the City's revenue
derived from taxation. The sales
tax will supplement a currently
growing property tax digest.
• With- the passage of the
local option sales tax, the
pressure to maintain the school
millage tax rate at its present
level.
_• The Department of Budget
and Planning recommended the
local sales tax option.
The Cons
• The Local Option Sales Tax
is being falsely presented as a
means of increasing city revenues
rather than what it is: a substitute
for the property tax intended to
shift completely the cost of local
government from the well-to-do
property holder to the rank and
file consumer.
• The primary assumption un
derlying the local option sales tax
is that property taxes are ex
cessively high—which is not the
case.
•_ Passage of the local option
sales tax would accrue direct sub
stantial financial benefits to large
businesses, but few or no benefits
to most citizens.
• If the referendum passes,
the cost of general city
operations would rest dispropor
tionately upon the sales tax and
by inference on low and in
termediate consumers.
• With a lower overall proper
ty tax, the pressure to keep the
school tax at its present level will
be formidable, thus resulting in
deleterious consequences for
Atlanta’s school system.
,• The city’s Bureau of Budget
and Planning did not recommend
the sales tax as the preferred op
tion for dealing with the city’s
financial needs.
_ • The sales tax is a regressive • The local option sales tax is
tax but it is still preferable to the an unrighteous attempt to impose
likeliest alternative a 6-mil in- a regressive tax on the poor,
crease in the property tax, or
severe cuts in the city services.
• Despite the fact that the
vast majority of the programs are
federally funded, the City also
allocates over $14 million to such
programs. It is low and moderate
income residents who will be
most disadvantaged if the city is
forced to make reduction in these
areas.
• Atlanta’s share in the 198U
will be approximately $24
million. The first year’s revenue
is desperately needed to sup
plement the City’s operating
budget in 1980 in order to main
tain existing services plus cover
certain new expenses in 1980.
• The City is and has Deen ex
ploring all potential revenue
sources. The emphasis on the
Local Option Sales Tax is one
result of this effort.
• Social and other services on
which the poor depend would not
be affected by cuts in the city’s
general fund because there
programs are federally funded.
* The city has not demon
strated why it needs the $54
million (sic) that a sales tax in
crease would generate.
Consequently, forces opposing
the local option sales tax contend
that the tax is merely a substitute
instead of a supplement to the
city’s present revenues. Ac
cording to a report released by
the Coalition Against the Local
Option Sales Tax, ‘'the law
clearly intended to make it
possible for counties to use the
sales tax to shift completely the
cost of local government from
well-to-do property holders to
rank and file consumers.”
John Boon is chairman of the
Coalition Against the Local Op
tion Sales Tax. Dr. Mack Jones,
chairman of the Atlanta Univer
sity political science department
and Father Isaac Miller are co-
chairmen of the coalition.
Forces pushing for approval of
the local option sales tax say that
the coalition is wrong in saying
that the sales tax is a substitute in
stead of a supplement to existing
tax revenues. According to a
report from the city’s Office of
Budget and Planning, “the
property owners share of the bur
den will continue to be significant
although the City/County total
(property tax) will always be ap
proximately 14 mills below the
level it would reach without the
sales tax.
Mayor Maynard Jackson and
Fulton County Commissioner
Milton Farris are co-chairing
Citizens for Atlanta/Fulton,
which is the group favoring the
local option sales tax. Fulton
County Commissioner Michael
Lomax is campaign coordinator
of Citizens for Atlanta/Fulton.
Below is a list of arguments for
and against the local option sales
tax. The arguments are taken
from the reports of the Coalition
Against the Local Option Sales
Tax and the Office of Budget and
Planning.
• The city snouia explore
otner potential sourves of
revenues.
Mayor Favors Tax
By Pamela Denise Moore
Earlier this month Mayor
Maynard J ackson responded
strongly to allegations that he is
supporting the local option sales
tax in hopes of gaining big
business support in the upcoming
senatorial race.
The mayor stated, “One of the
basic things in politics is that one
does not support an additional
tax when one is running for of
fice. I have not made a decision
on whether I will run for the
senate next year, but that is
irrelevant to this issue.
“The politically smart thing to
do,” said the mayor, “would be to
stay away from this tax—as far as
possible. But the city of Atlanta
needs this additional revenue,
and the local option sales tax of
fers the best available option for
raising the needed revenue.”
The mayor added, “Big
business support has been
lukewarm at best. It would be
political suicide to seek their sup
port at the expense of my
traditional constituents, those
whom I have sought to serve with
particular dedication during my
administration.”
Michael Lomax, also accused
of supporting the local tax for
personal political reasons,
responding by saying “Obviously,
supporting the local option tax is
not the most politically popular
thing to do. I support the tax
because the city needs the money
to operate and because 40 per
cent of the revenues will come
from non-residents who either
work in Atlanta or come to
Atlanta for entertainment.
“The sales tax was initially
recommended to the city in 1975
by Future Funding Task Force
which was headed by then Atlan-
(See Ca r, pg. 5)
Group Opposes Tax
By Kiron Kanina Skinner
According to Dr. Mack J ones,
the ramifications of an increase
on the sales tax would extend it
self to Spelmanites and other
college students. He explained,
“To put the local option sales tax
referendum into effect, it is
necessary to raise taxes on Atlan
ta’s students and poor people
while big businesses have their
taxes decreased by hundreds of
thousands of dollars.
In an attempt to ascertain the
arguments of the opposition to
the local option sales tax, the
Spotlight interviewed Dr. Mack
J ones, chairman of the Political
Sciences Department at Atlanta
University and co-chairman of
the Coalition Against The Local
Option Sales Tax, and Adolph
Reed, a professor at the Clark
College Southern Center for
Studies in Public Policy. As a
result, the Spotlight was able to
identify many of the issues
surrounding the referendum,
which are examined in this sum
mation.
J ones said that it is not only the
college students that will suffer if
the referendum passes. A 1 cent
sales tax increase will pertain to
gasoline and all goods and ser-
vices already under the jurisdic
tion of the sales tax. It is also the
rank and file consumer, Dr.
J ones stressed, who will feel the
increase when he visits the stores.
According to a report
published by the Coalition Again
st The Local Option Sales Tax,
passage of the referendum will
disproportionately place the cost
of general city operations on the
low and moderate income con
sumers.
But while the private citizen
will be burdened with higher
sales taxes, if the referendum
passes, twenty big companies in
(See LOCAL, pg. S)