Legislation has been enacted that amends Georgia laws related to the prohibition against the absorption of sales and use tax, recently enacted provisions governing an excise tax phase-in on manufacturer purchases of energy, and jurisdiction over the 1% county special purpose local option sales and use tax.
Absorption of Tax
The legislation limits the prohibition under the law against any retailer advertising or representing to the public that it will absorb all or any part of sales and use tax or that a purchaser is relieved from paying all or any part of sales and use tax. Specifically, effective July 1, 2012, a retailer can make such an advertisement or representation to the public if the retailer states in the advertisement that the retailer will remit any part of the tax not paid by the purchaser, or if the retailer gives the purchaser written evidence that the retailer will be liable for and pay any tax the purchaser was relieved from paying. If a retailer does in fact advertise that any part of the tax not paid by the purchaser will be remitted on the purchaser’s behalf by the retailer, the retailer is solely liable for and must pay the tax as advertised.
Phase-In of Local Excise Tax on Manufacturers’ Energy Purchases
The legislation amends, effective January 1, 2013, two provisions contained in recently enacted tax reform legislation (H.B. 386, Laws 2012) governing the upcoming four-year phase-in of a local excise tax imposed on manufacturer purchases and uses of energy. (TAXDAY, 2012/04/23, S.8)
The first provision is amended to provide that within 30 days after a meeting of county and municipal governing authorities within a special district held before the adoption of an ordinance to levy the tax from January 1, 2013, to December 31, 2013, such municipalities can adopt an ordinance levying the tax (and be entitled to all of the tax proceeds) if the county refuses to enter into an intergovernmental agreement to levy the tax. Also, any county that desires to impose the tax countywide within a special district beginning January 1, 2013, must mail written notice to the mayor or chief elected official in each municipality located within the special district by September 1, 2012.
The second provision, also related to the phase-in of the excise tax on manufacturer purchases and uses of energy, is amended to state that despite the 2% cap on this tax within a special district or municipality, a 3% cap applies if a municipality levies a water and sewer projects and costs sales and use tax. Also, the excise tax takes effect on the first day of the next succeeding month following the adoption of an ordinance unless otherwise specified in an intergovernmental agreement between a county and municipalities within a special district.
Jurisdiction Over County Special Purpose Tax
Effective July 1, 2012, Georgia superior courts will have jurisdiction to enforce compliance with respect to the 1% county special purpose local option sales and use tax. Such jurisdiction includes the power to grant injunctions or other equitable relief. Further, the Georgia Attorney General will have authority to bring civil or criminal enforcement actions with regard to this local tax.
S.B. 332, Laws 2012, effective as noted