Georgia sales tax
The Government charges Sales Tax on the purchase of any goods, retail sales, lease and rentals or services at the point of purchase. It is a consumption tax imposed on retail sales and taxable services. A percentage on the price is added on to the price as sales and use tax. Sales Taxes are assessed mostly by the states in the US. The merchant has the responsibility to collect and pay sales tax to the state. Usually the consumers only are charged sales tax and those who do not use the commodity or resellers are not charged. Some states require that the resellers produce the certificate to prove their authenticity for claiming exemption. In Georgia the sales tax is charged at 4 percent. Exemption from sales and use tax is given to items such as some medical devices and prescription drugs. Local authorities may levy additional tax like local option tax, special purpose local option tax, Metropolitan Atlanta Rapid Transit Authority (MARTA) tax etc.
Georgia Sales and Use Tax
When the consumer purchases goods from a place out of the state or makes a purchase through the internet, he has to pay use tax even though there is no sales tax in this case. If the same purchase is made in the local store, sales tax is levied. A 1 percent Municpal Option Sales tax is collected in Atlanta.
Effect of Sales tax on consumers
Typically one third of the price is paid by the consumer as sales tax on an average on his or her expenditures. This works out to an average of 7.5 percent on the expenditure of each individual and 2.5 per cent of the individual s income. Some items are excluded from sales tax for the benefit of the low income groups. Items like clothing, non-prepared food and prescription drugs are exempt from sales tax to give them some relief in many states. Some consider sales tax necessary as it is levied only on the consumption items and is therefore preferable as it paves the way for savings and investments that propels the economic growth of that area.
Sale Tax Exemptions
In the state of Georgia, certain categories of goods and services are exempt from sales tax. These exemptions are intended to give an impetus to the growth of the manufacturing industry which in turn opens new avenues for employment and overall prosperity in the state.
Manufacturing machinery is exempt from local sales tax. For machinery bought for upgrading or replacing the existing machinery the exemption is allowed for remanufacturing of components and aircraft engines and components. They are machinery and equipment in a clean room of Class 100 below is exempt.
Warehouses and distribution centers with their material handling equipment is exempted if the company spends a minimum of 5 million dollars in expansion or in creating a new set up.If the total cost electricity consumed in manufacturing a product exceeds half of the total cost of manufacturing is exempt from tax too. ++
The sales tax is payable monthly, quarterly and yearly depending upon certain norms and the 20th day of every month. Overdue taxes are charged interest if the delay exceeds 60 days after the due date.
In Georgia, exemption on sales tax is granted to qualifying 501(C) (3) Institutions. Producing the certificate on sales tax exemption leads to exemption can lead to exemption of the sales and use tax on business travel and accommodation also.
In most of the counties, property taxes are exempted on warehouse inventories, if they are meant for shipping to other states.
The Local Option Free Port Law of Georgia State allows the exemption of property tax up to 100 per cent of inventory of the company \'s qualified products.
Physicians, Hospitals and such professional services in healthcare are exempt from sales and use tax. Tangible personal property sold by manufacturers is exempt from sales tax in Georgia.
Some exemptions apply to the items of tangible personal property sold by the manufacturer. Georgia law imposes a tax on the gross lease or rental charge for tangible personal property.
Sales tax exemption can be claimed Form ST-5 Application for Georgia Sales and Use Tax Certificate of Exemption. To be eligible for sales tax exemption, payments must be made with check or credit card. Sales tax waiver is available for CTM network hotels that participate in 501 (c) (3) with production of tax exemption documents. Businesses are allowed to make online shipments to Georgia. Those wineries that do not have a distributor in Georgia are eligible to receive a Special Order Shipping License. These businesses need not collect or pay sales tax. The sales tax is collected from the person to whom the tangible property is leased by the person who leases or rents it, at the rate applicable in that county. The person to whom the tangible personal property is leased or rented is liable for the tax and must pay the tax to the person who leases or rents the property.
Tax Consultants The tax consultants help Georgia Companies valuable services in tax related matters. The consultant can identify and obtain refunds of unclaimed sales and use tax. They also identify the probable opportunities for savings and resolve issues arising out of the past sales tax payments.Negotiating with the auditors on audits pertaining to sales and use tax and such other services and deal with the state anonymously on behalf of the company are some other services offered by the consultants.They understand the businesses and strive to consistently identify opportunities for the companies to save on tax.
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