Georgia Tax Court Eyed

Practitioners hope to see a state tax court started in Georgia, one of 27 states lacking a dedicated tax court or administrative appeals forum fully independent of a state revenue agency. Besides removing proceedings from any appearance of bias, an independent tax tribunal offers several other advantages including a less crowded docket, greater tax expertise from the bench, more uniformity and published decisions, proponents say. The State Bar of Georgia’s Taxation Law Section has drafted a proposed bill to establish the court, which would hear appeals from the state Department of Revenue. Filing a petition would stay an enforcement or collection action, eliminating the “pay to play” requirement currently in effect.

Under Georgia’s present system, taxpayers not satisfied with a state revenue assessment may appeal to a state superior court or the Office of State Administrative Hearings, whose decisions are not binding on the Department of Revenue. The proposed legislation would grant the tax court and superior courts concurrent jurisdiction to hear appeals. The new court would also include a small-claims venue.

Proponents hope to introduce legislation in the state’s 2009 legislative ­session. The court will require a pilot ­program, with approval by two-thirds of each legislative chamber required to become a permanent body, said Peter Stathopoulos, managing director of state and local taxes of Atlanta-based accounting firm Bennett Thrasher PC, and John Allan, tax partner at law firm Jones Day’s Atlanta office. Allan chairs, and Stathopoulos is a member of, the State Bar of Georgia’s task force that drafted the proposed legislation. Both are CPAs and attorneys.

In its 2007 publication of The Best and Worst of State Tax Administration, the Council on State Taxation listed 21 states as lacking an independent tax dispute forum and gave another six an intermediate ranking. The study can be read here.