Georgia May Get $100 Million More in Revenue; Citizens Wouldn't Pay a Dime

By David North on November 15, 2016

The State of Georgia could raise as much as $100 million in new revenues without costing the state's voters a dime.

It could do this by tapping into money sent abroad by aliens, many of them in illegal status — and money sent abroad by drug dealers, as well, whatever their status.

This will happen if a bill expected to be introduced by State Rep. Jeff Jones (R -Brunswick) is passed by the state legislature and signed by the governor. The bill has not yet been introduced, and thus does not have a legislative number. I am told all this by a highly reliable source in Atlanta.

The bill would bring to Georgia a system that has worked well in Oklahoma for years. It would place a 2 percent fee on all personal (not corporate) wire transfers of money sent out of state. The 2 percent would be returned to the payers when they filed their income tax returns, either as a credit toward their tax or a refund if the sender's income is low enough.

The beauty of the program is that most of the money now being wired out of Georgia, usually to aliens' home countries, is not now being taxed. Oklahoma tax officials told me in the past that only a very small percentage of the fees they collect are claimed in the next year's income tax returns.

So the transfer fee will cost law-abiding taxpayers little or nothing, but will collect most of its revenues from previously untaxed sources; including a lot from the incomes of illegal aliens.

Where do I get the $100 million estimate? It works like this: Oklahoma has about 95,000 illegal aliens according to the most recent Pew Research Center estimate, while Georgia, according to the same source has about four times as many, 375,000. So that's a four-to-one ratio.

Meanwhile, Oklahoma has set the fee at 1 percent, while Jones suggests 2 percent. That adds up to an eight-to-one differential. The latest data, for the fiscal year ended June 30, 2016, show that Oklahoma collected $12,696,976 in these fees. Multiply that by eight and this produces an estimate of more than $100 million.

Oklahoma's experience is that this income increases by 10 to 12 percent a year.

My advice to Rep. Jones would be to modify his fee structure. Currently the bill calls for a 2 percent fee plus $10; this would cost, for a $200 check $14, or 7 percent; for $1,000 it would cost $30, or 3 percent. Tilting the formula against the little guy is, sadly, one of the things we do these days, and this could be a source of opposition. On the other hand, there has to be a minimum fee to cover the cost of the paperwork.

So it would seem to be better to have a $10 fee or 2 percent, whichever is higher. Oklahoma's formula is $10 or 1 percent, whichever is higher. The fee for a $200 check sent from Georgia would then be 5 percent, and for the $1,000 one it would be 2 percent. That formula would stir up less opposition. Further, I gather that the Jones bill will, wisely, pay the wire transfer operators a small fee for handling these arrangements; that should reduce any opposition from the industry.

And, of course, very, very few law-abiding Georgia taxpayers would actually be paying these transfer fees.