SWGA Politics

Are GA Leaders Costing Georgians Jobs?

Georgia leaders like to talk about how they are bringing jobs to Georgia, especially under this economic climate. DuBose Porter has one plan and Republicans in the General Assembly consistently talk about how proud they are of their own efforts this past session with the passage of the JOBS Act.

But I ran into a dirty little secret over the past few days, one which State Rep Jeff Mays was kind enough to point out to me was part of Georgia Law.

You see, I like to do most of my Christmas shopping online. Quite frankly, I’m not such a fan of the crowds on Black Friday or pretty much any day between Thanksgiving and Christmas, and most stores offer the same deals online as you get in the physical store. So I get the same price with nowhere NEAR the hassle. As an added bonus, if I shop online I don’t have to pay sales tax. But that is where the dirty little secret comes in.

You see, OCGA 48-8-2, subsection 3 part E states that a “dealer” in the State of GA can be defined as anyone who “Maintains or has within this state, indirectly or by a subsidiary, an office, distribution center, salesroom or sales office, warehouse, service enterprise, or any other place of business”.

What this means is that any store that has pretty much any physical presence in Georgia must charge Georgia sales tax on its sales – whether from a brick and mortar store or from online sales. There may be some caveats within there, but none that I saw in about 20 minutes of searching.

This gives a competitive advantage to some sites, such as Amazon.com, which is who got my business after I learned that my preferred store, BestBuy.com, had the exact same deals as Amazon.com but had to charge me sales tax due to this law, while Amazon.com did not.

This also costs Georgians jobs, because retailers who get a significant amount of business from online sales are not going to want to have any form of physical presence in Georgia – not even so much as a two-person office. For example, a major retailer – Cabela’s Outdoors – was actively working to build a new store in Adairsville, GA barely 5 miles from the school I graduated HS from just a few years ago. I’m now told that the primary reason they did NOT build was directly because of this law. That was to be a combined retail/warehouse site, and would have meant something along the lines of 100-200 jobs at a bare minimum, not to mention the economic impact on an area of Bartow County that could really use the money. For those that are unaware, one of Cabela’s biggest competitors -and one who I’m told Cabela’s physical stores are most similar to – is Bass Pro Shops. This Cabela’s would have been the only one in a 3 state radius – the next closest store would have been outside Baton Rouge! The physical store alone would have generated a LOT of sales tax money for the State and the County, but our leaders got greedy with this code section above, and we lost out on potentially hundreds of jobs just from this one retailer.

Furthermore, let’s look at the border cities issues, which are major areas of concern in areas such as extreme northwest GA, Columbus, Valdosta, Augusta, Savannah, Rome, and even in South GA along the FL and AL lines. Assuming our border states do not have similar clauses in their own laws, this means that a company – whether it be a mom-and-pop operation that employs a handful of people or an operation such as Cabela’s that employs a few hundred people per site – could locate just across the border in any of these areas and utilize the Georgia population to drive its profit from the physical store while still enjoying its tax-free online sales due to the other state’s tax laws! In other words, more jobs and tax revenue LOST because of Georgia lawmakers!

A final note on this topic, for now: One person tried to call me a “tax dodger” on Facebook over this issue. He said that I could take advantage of in-store pickup from a store located in Georgia, and thus this made up for the additional unnecessary tax burden. But Best Buy was the store in question, and the closest physical store they have to Albany is roughly 100 miles away. Even at my parents’ house in Cartersville, the closest Best Buy store is about 25 miles away, and I own a full-size pickup truck and a small SUV right now. This means that either way, if I go to Best Buy physically – even just to pickup an item I ordered online – I’m going to spend a minimum of roughly $5 in gas to get that item – in addition to paying the sales tax! Meanwhile, I can go to Amazon.com, but that exact same item and have it delivered to my door with NO sales tax! As a consumer, why would I want to pay more for the same item??? This is just one example – as we all know, there are quite a few stores that fall into this same problem for us here in Southwest Georgia!

This next session, Georgia lawmakers including both Speaker of the House Glenn Richardson and many State Representatives and a few State Senators have said that jobs and the economy are one of the top – if not THE top – priority they have. I have a potential solution I’d like them to consider:

Repeal OCGA 48-8-2, subsection 3 part E.