ACCG Annual Conference 2013 Sales Tax Update

Transcription

1 ACCG Annual Conference 2013 Sales Tax Update This presentation is the property of the Commissioner, Georgia Department of Revenue. All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form by any means, electronic, mechanical photocopying, recording, or otherwise, without the prior written permission of the Commissioner, Georgia Department of Revenue 1

2 Presented By: Amy Oneacre Sales & Use Tax Policy Manager 2

3 Discussion Topics Tax Reform Georgia HB 386 (2012) GATE Program Manufacturing Exemptions E-Fairness and CPRS TSPLOST 2013 Legislative Update 3

4 HB 386 Sales Tax Related Impact Film Industry Motor Vehicles Manufacturing Agriculture Sales Tax Holidays E-Fairness Jet Fuel Convention and Trade Shows Competitive Projects of Regional Significance 4

5 Manufacturing Exemptions Effective January 1, 2013, the sale, use, or storage of machinery, equipment, industrial materials, and manufacturing packaging supplies shall be exempt from all sales and use taxation. Effective January 1, 2013, Energy used in manufacturing will be partially exempt from sales and use taxation. 5

6 New For Manufacturing 2013 Returnable, reusable, single use packaging; Industrial materials of all kinds; Manufacturing for promotional use; Energy Phase-In; No Exemption application process for new manufacturing plants. 6

7 Exemption for Energy Used in Manufacturing Effective January 1, 2013, the sale, use, storage, or consumption of energy, which is necessary and integral to the manufacture of tangible personal property at a manufacturing plant in this state, will be partially exempt from sales tax. This exemption applies to energy used for administrative purposes, transport of raw or finished goods, heating and cooling, and any other purpose at a manufacturing plant. 7

8 Energy Used in Manufacturing (Cont.) "Energy" means natural or artificial gas, oil, gasoline, electricity, solid fuel, wood, waste, ice, steam, water, and other materials essential for heat, light, power, refrigeration, climate control, processing, or any other use in any phase of the manufacture of tangible personal property. This energy exemption does not apply to energy purchased by a manufacturer primarily engaged in producing electricity for resale. 8

9 Energy Used in Manufacturing (Cont.) This energy exemption will be phased in a four year period, 2013 through Transactions occurring during the 2013 calendar year qualify for a 25% exemption. 50% in % in % in Note: Energy will still be subject to ELOST. 9

10 Energy Used in Manufacturing (Cont.) Counties and municipalities have the option to levy a local excise tax on energy. This would be subject to sales and use tax except for exemptions. The obligation of a local excise tax is phased-in the same manner as exemptions. The rate of the tax will vary depending on the locality or district. Other local taxes are imposed, but in no event can the rate exceed 2%. 10

11 Agriculture Related Exemptions Effective January 1, 2013, sales and use by a Qualified Agriculture Producer of agricultural production inputs, energy used in agriculture, agricultural machinery and equipment, shall be exempt from sales and use tax. A taxpayer that meets the statutory criteria for designation as a Qualified Agriculture Producer may apply to the Commissioner of Agriculture requesting an agricultural sales and use tax exemption certificate (GATE) that contains an exemption number 27,000+ GATE cards issued. 11

12 Agriculture Related Exemptions (Cont.) Machinery and equipment, including repair and replacement parts, will be exempt from sales and use tax. If at the time of sale or lease, the components, when assembled, will have the character of agricultural machinery or equipment. Note: ATV s and UTV s sold to qualified agriculture producers are exempt. 12

13 Energy Used In Agriculture Energy used in agriculture means fuels used for agricultural purposes, including, but not limited to, off-road diesel, propane, butane, electricity, natural gas, wood, wood products, or wood by-products; liquefied petroleum gas or other fuel used in structures in which broilers, pullets, or other poultry are raised, in which swine are raised, in which dairy animals are raised or milked or where dairy products are stored on a farm, in which agricultural products are stored, and in which plants, seedlings, nursery stock, or floral products are raised primarily for the purposes of making sales of such plants, seedlings, nursery stock, or floral products for resale; electricity or other fuel for the operation of an irrigation system which is used on a farm exclusively for the irrigation of agricultural products; and electricity or other fuel used in the drying, cooking, or further processing of raw agricultural products, including, but not limited to, food processing of raw agricultural products. 13

14 Energy Used In Agriculture (Cont) Not all energy is exempt Many Questions Separate metering may be required Deminimus energy use standard Gap period refund claims Energy seller burdens 14

15 Agriculture Related Exemptions (Cont.) Agricultural producers MUST apply with the Department of Agriculture for a sales tax exemption certificate (GATE certificate) - Effective January 1, 2013 Form ST-A1 is NOT VALID GATE Certificate requires an annual renewal process Department of Agriculture (DOA) will share all registration data with the Department of Revenue (DOR) DOA administers WHO gets and exemption, and DOR administers WHAT is exempt. 15

16 Who is a Qualified Agricultural Producer? SAMPLE NAICS CODES (Not Inclusive): Animal Food Manufacturing Fruit and Vegetable Canning* 3315 Dairy Product Manufacturing* Animal Slaughtering (Except Poultry)* Poultry Processing Wineries* *If on a farm Many questions regarding who qualifies and what qualifies. 16

17 E-Fairness Part 1 Beginning October 1, 2012, out-of-state sellers must collect sales tax from Georgia customers if: a) A related company located in Georgia sells similar products using a similar business name as the out-of-state seller, or the related company uses trademarks, service marks, or trade names in Georgia similar to those used by the seller; or b) On behalf of the seller, a person or entity located in Georgia delivers, installs, or assembles the seller s product, performs maintenance services, or provides a customer pick-up service in Georgia, or performs other similar activities in Georgia on behalf of the seller. 17

18 E-Fairness-Part 2 Beginning December 31, 2012, out-of-state sellers must collect sales tax from Georgia customers if: a) The seller made more than $50,000 of sales to Georgia customers in the preceding 12 months that were referred to the seller by Georgia residents, whether by a link on an internet website, an in-person presentation, telemarketing or otherwise; and b) The seller pays a commission or other consideration to Georgia residents based on completed sales referred to them by the resident. 18

19 Competitive Projects of Regional Significance O.C.G.A (93) Competitive Project of Regional Significance (CPRS) means the location or expansion of some or all of a business enterprise's operations in Georgia when the Commissioner of Economic Development determines that the project would have a significant regional impact. 19

20 Competitive Projects of Regional Significance (Cont.) CPRS s are granted a sales tax exemption on: All purchases of tangible personal property used in construction; and All purchases of energy including gas, steam, and water used in construction. The exemption is valid through the CPRS s entire time of construction. 20

21 TSPLOST 3 Regional Transportation Districts passed the TSPLOST Central Savannah, River Valley, and Heart of Georgia; 1% additional sales tax Some exemptions apply; TSPLOST requires separate reporting, accounting, and distribution; Form ST-3 changed significantly!! 21

22 FORM ST-3 Form Changes Separate county by county line item reporting for energy sold to manufacturers. TSPLOST Schedule Separate reporting required. Multiple sales tax rate charts. 22

23 2013 Legislative Update HB 164 Extends sunset for exemption on aircraft engine, parts and equipment and other tangible personal property used in maintenance for aircraft not registered in Georgia. Continues support for Georgia s aircraft maintenance and repair industries. 23

24 2013 Legislative Update HB 193 Reinstates Several Sales Tax Exemptions Nonprofit or volunteer health centers and clinics Sales of food to food banks and hunger relief Prepared food donated for disaster relief Job training organizations Modifies dates for sales tax holiday 2013 Excludes direct mail postage from delivery charges Tourism Act Correction NOT signed by Governor 4/15/13 24

25 2013 Legislative Update HB 250 Revises provisions relating to local excise tax on sale or use of energy sold to manufacturers Compensates dealers in the form of a deduction of 3% of the first $3000 and.5% of remaining amount of all energy excise tax collected and timely remitted Clarifies that the excise tax does not apply to sales of energy used for and in the construction of a competitive project of regional significance Provides 3-year limitation on assessments and refunds Provides details such as return deadlines and extensions, estimated tax liability, record retention, penalties and interest, and criminal penalties. 25

26 2013 Legislative Update HB 266 Incorporates Internal Revenue Code updates into Georgia law. Reinstates the good faith requirement for acceptance of exemption certificate. Requires taxpayers to choose either agricultural producer or manufacturer status for purpose of sales and use tax exemptions. 26

27 Legislative Update 2013 HB 318 Amends relating to Georgia Tourism Development Act Only one company may receive the refund for any one tourist attraction Removes incremental sales tax from calculation The annual refund for new projects is the lesser of 2.5% of approved costs (development and construction costs) or sales tax generated by retail sales at the tourism attraction. Clarifies the calculation of the refund for expansions. The annual refund for expansions is the lesser of the incremental sales tax or 2.5 percent of approved costs. Incremental sales tax is difference between sales tax generated by the attraction after the expansion and sales tax generated prior to the expansion. Clarifies that refunds do not accrue interest. Removes local sales taxes from the refund. 27