2020 Georgia Code
Title 48 - Revenue and Taxation
Chapter 8 - Sales and Use Taxes
Article 1 - State Sales and Use Tax
Part 1 - General Provisions
§ 48-8-2. Definitions

As used in this article, the term:

1. "Alcoholic beverages" means beverages that are suitable for human consumption and contain one-half of one percent or more of alcohol by volume.
2. "Ancillary services" means services that are associated with or incidental to the provision of telecommunications services, including but not limited to detailed telecommunications billing service, directory assistance, vertical service, and voice mail services.
3. 1. "Bundled transaction" means the retail sale of two or more products, except real property and services to real property, where the products are otherwise distinct and identifiable and the products are sold for one nonitemized price.A bundled transaction does not include the sale of any products in which the sales price varies, or is negotiable, based on the selection by the purchaser of the products included in the transaction.
   2. As used in this paragraph, the term "distinct and identifiable products" shall not include:
      1. Packaging such as containers, boxes, sacks, bags, and bottles or other materials such as wrapping, labels, tags, and instruction guides, that accompanies the retail sale of the products and are incidental or immaterial to the retail sale thereof.Examples of packaging that are incidental or immaterial include grocery sacks, shoe boxes, dry cleaning garment bags, and express delivery envelopes and boxes;
      2. A product provided free of charge with the required purchase of another product.A product is provided free of charge if the sales price of the product purchased does not vary depending on the inclusion of the product provided free of charge; or
      3. Items included in the sales price.
   3. As used in this paragraph, the term "one nonitemized price" shall not include a price that is separately identified by product on binding sales or other supporting sales related documentation made available to the customer in paper or electronic form including, but not limited to, an invoice, bill of sale, receipt, contract, service agreement, lease agreement, periodic notice of rates and services, rate card, or price list.
   4. A transaction that otherwise meets the definition of a bundled transaction as provided under this paragraph shall not be a bundled transaction if such transaction is:
      1. The retail sale of tangible personal property and a service where the tangible personal property is essential to the use of the service, is provided exclusively in connection with the service, and the true object of the transaction is the service;
      2. The retail sale of services where one service is provided that is essential to the use or receipt of a second service, the first service is provided exclusively in connection with the second service, and the true object of the transaction is the second service;
      3. (I) A transaction that includes taxable products and nontaxable products and the purchase price or sales price of the taxable products is de minimis.As used in this subparagraph, the term "de minimis" means the seller's purchase price or sales price of the taxable product is 10 percent or less of the total purchase price or sales price of the bundled products.
   5. Sellers shall use either the purchase price or the sales price of the products to determine if the taxable products are de minimis.Sellers may not use a combination of the purchase price and sales price of the products to determine if the taxable products are de minimis.
   6. Sellers shall use the full term of a service contract to determine if the taxable products are de minimis; or
      1. The retail sale of exempt tangible personal property and taxable tangible personal property where:
   7. The transaction includes food and food ingredients, drugs, durable medical equipment, mobility enhancing equipment, over-the-counter drugs, or prosthetic devices; and
   8. The seller's purchase price or sales price of the taxable tangible personal property is 50 percent or less of the total purchase price or sales price of the bundled tangible personal property.Sellers may not use a combination of the purchase price and sales price of the tangible personal property when making the 50 percent determination for a transaction.
4. "Business" means any activity engaged in by any person or caused to be engaged in by any person with the object of direct or indirect gain, benefit, or advantage.
5. "Coin operated telephone service" means a telecommunications service paid for by inserting money into a telephone accepting direct deposits of money to operate.
6. "Computer software" means a set of coded instructions designed to cause a computer or automatic data processing equipment to perform a task.
7. "Conference bridging service" means an ancillary service that links two or more participants of an audio or video conference call and may include the provision of a telephone number. Conference bridging service shall not include the telecommunications services used to reach the conference bridge.
8. "Dealer" means every person who:
   1. Has sold at retail, used, consumed, distributed, or stored for use or consumption in this state tangible personal property and who cannot prove that the tax levied by this article has been paid on the sale at retail or on the use, consumption, distribution, or storage of the tangible personal property;
   2. Imports or causes to be imported tangible personal property from any state or foreign country for sale at retail, or for use, consumption, distribution, or storage for use or consumption in this state;
   3. Is the lessee or renter of tangible personal property and who pays to the owner of the property a consideration for the use or possession of the property in this state without acquiring title to the property;
   4. Leases or rents tangible personal property for a consideration, permitting the use or possession of the property in this state without transferring title to the property;
   5. Maintains or utilizes within this state an office, distribution center, salesroom or sales office, warehouse, service enterprise, or any other place of business, whether owned by such person or any other person, other than a common carrier acting in its capacity as such;
   6. Manufactures or produces tangible personal property for sale at retail or for use, consumption, distribution, or storage for use or consumption in this state;
   7. Sells at retail, offers for sale at retail, or has in his possession for sale at retail, or for use, consumption, distribution, or storage for use or consumption in this state tangible personal property;
   8. Solicits business by an agent, employee, representative, or any other person;
   9. Engages in the regular or systematic solicitation of a consumer market in this state, unless the dealer's only activity in this state is:
      1. Advertising or solicitation by:
   10. Direct mail, catalogs, periodicals, or advertising fliers;
   11. Means of print, radio, or television media; or
   12. Telephone, computer, the Internet, cable, microwave, or other communication system;
       1. The delivery of tangible personal property within this state solely by common carrier or United States mail; or
       2. To engage in convention and trade show activities as described in Section 513(d)(3)(A) of the Internal Revenue Code, so long as such activities are the dealer's sole physical presence in this state and the dealer, including any of its representatives, agents, salespersons, canvassers, independent contractors, or solicitors, does not engage in those convention and trade show activities for more than five days, in whole or in part, in this state during any 12 month period and did not derive more than $100,000.00 of net income from those activities in this state during the prior calendar year. A retailer engaging in convention and trade show activities, as described in Section 513(d)(3)(A) of the Internal Revenue Code, is a retailer engaged in business in this state and liable for collection of the applicable sales or use tax with respect to any sale of tangible personal property occurring at the convention and trade show activities and with respect to any sale of tangible personal property made pursuant to an order taken at or during those convention and trade show activities.

       The exceptions provided in divisions (i), (ii), and (iii) of this subparagraph shall not apply to any requirements under Code Section 48-8-14;

   13. Is an affiliate that sells at retail, offers for sale at retail in this state, or engages in the regular or systematic solicitation of a consumer market in this state through a related dealer located in this state unless:
       1. The in-state dealer to which the affiliate is related does not engage in any of the following activities on behalf of the affiliate:
   14. Advertising;
   15. Marketing;
   16. Sales; or
   17. Other services; and
       1. The in-state dealer to which the affiliate is related accepts the return of tangible personal property sold by the affiliate and also accepts the return of tangible personal property sold by any person or dealer that is not an affiliate on the same terms and conditions as an affiliate's return;

       As used in this subparagraph, the term "affiliate" means any person that is related directly or indirectly through one or more intermediaries, controls, is controlled by, is under common control with, or is subject to the control of a dealer described in subparagraphs (A) through (I) of this paragraph or in this subparagraph;

   18. 1. Makes sales of tangible personal property or services that are taxable under this chapter if a related member, as defined in Code Section 48-7-28.3, other than a common carrier acting in its capacity as such, that has substantial nexus in this state:
   19. Sells a similar line of products as the person and does so under the same or a similar business name; or
   20. Uses trademarks, service marks, or trade names in this state that are the same or substantially similar to those used by the person.
       1. The presumption that a person described in this subparagraph qualifies as a dealer in this state may be rebutted by showing that the person does not have a physical presence in this state and that any in-state activities conducted on its behalf are not significantly associated with the person's ability to establish and maintain a market in this state;
   21. 1. Makes sales of tangible personal property or services that are taxable under this chapter if any other person, other than a common carrier acting in its capacity as such, who has a substantial nexus in this state:
   22. Delivers, installs, assembles, or performs maintenance services for the person's customers within this state;
   23. Facilitates the person's delivery of property to customers in this state by allowing the person's customers to pick up property sold by the person at an office, distribution facility, warehouse, storage place, or similar place of business maintained by the person in this state; or
   24. Conducts any other activities in this state that are significantly associated with the person's ability to establish and maintain a market in this state for the person's sales.
       1. The presumption that a person described in this subparagraph qualifies as a dealer in this state may be rebutted by showing that the person does not have a physical presence in this state and that any in-state activities conducted on its behalf are not significantly associated with the person's ability to establish and maintain a market in this state;
   25. 1. Enters into an agreement with one or more other persons who are residents of this state under which the resident, for a commission or other consideration, based on completed sales, directly or indirectly refers potential customers, whether by a link on an Internet website, an in-person oral presentation, telemarketing, or otherwise, to the person, if the cumulative gross receipts from sales by the person to customers in this state who are referred to the person by all residents with this type of an agreement with the person is in excess of $50,000.00 during the preceding 12 months.
       2. The presumption that a person described in this subparagraph is a dealer in this state may be rebutted by submitting proof that the residents with whom the person has an agreement did not engage in any activity within this state that was significantly associated with the person's ability to establish or maintain the person's market in the state during the preceding 12 months. Such proof may consist of sworn written statements from all of the residents with whom the person has an agreement stating that they did not engage in any solicitation in this state on behalf of the person during the preceding year, provided that such statements were provided and obtained in good faith. This subparagraph shall take effect December 31, 2012, and shall apply to sales made, uses occurring, and services rendered on or after December 31, 2012, without regard to the date the person and the resident entered into the agreement described in this subparagraph;

       (M.1) Obtains gross revenue, in an amount exceeding $100,000.00 in the previous or current calendar year, from conducting retail sales of tangible personal property to be delivered electronically or physically to a location within this state to be used, consumed, distributed, or stored for use or consumption in this state;

       (M.2) Conducts 200 or more separate retail sales of tangible personal property in the previous or current calendar year to be delivered electronically or physically to a location within this state to be used, consumed, distributed, or stored for use or consumption in this state;

       (M.3) Acts as a marketplace facilitator to facilitate retail sales that are taxable under this chapter to be delivered, held for pickup, used, consumed, distributed, stored for use or consumption, or rendered as a service within this state, if the total value of the sales price of all such retail sales, combined across all its marketplace sellers and the marketplace facilitator itself, equals or exceeds $100,000.00 in aggregate in the previous or current calendar year;

   26. Notwithstanding any of the provisions contained in this paragraph, with respect to a person that is not a resident or domiciliary of Georgia, that does not engage in any other business or activity in Georgia, and that has contracted with a commercial printer for printing to be conducted in Georgia, such person shall not be deemed a dealer in Georgia merely because such person:
       1. Owns tangible or intangible property which is located at the Georgia premises of a commercial printer for use by such printer in performing services for the owner;
       2. Makes sales and distributions of printed material produced at and shipped or distributed from the Georgia premises of the commercial printer;
       3. Performs activities of any kind at the Georgia premises of the commercial printer which are directly related to the services provided by the commercial printer; or
       4. Has printing, including any printing related activities, and distribution related activities performed by the commercial printer in Georgia for or on its behalf,

       nor shall such person, absent any contact with Georgia other than with or through the use of the commercial printer or the use of the United States Postal Service or a common carrier, have an obligation to collect sales or use tax from any of its customers located in Georgia based upon the activities described in divisions (i) through (iv) of this subparagraph. In no event described in this subparagraph shall such person be considered to have a fixed place of business in Georgia at either the commercial printer's premises or at any place where the commercial printer performs services on behalf of that person;

   27. Any ruling, agreement, or contract, whether written or oral and whether express or implied, between a person and this state's executive branch or any other state agency or department stating, agreeing, or ruling that such person is not a dealer required to collect sales and use tax in this state despite the presence of a warehouse, distribution center, or fulfillment center in this state that is owned or operated by the person or a related member shall be null and void unless it is specifically approved by a majority vote of each body of the General Assembly. For purposes of this subparagraph, the term "related member" has the same meaning as in Code Section 48-7-28.3;
   28. Each dealer shall collect the tax imposed by this article from the purchaser, lessee, or renter, as applicable, and no action seeking either legal or equitable relief on a sale, lease, rental, or other transaction may be had in this state by the dealer unless the dealer has fully complied with this article; or
   29. The commissioner shall promulgate such rules and regulations necessary to administer this paragraph, including other such information, applications, forms, or statements as the commissioner may reasonably require.
9. "Delivered electronically" means delivered to the purchaser by means other than tangible storage media.
10. "Delivery charges" means charges by the seller of personal property or services for preparation and delivery to a location designated by the purchaser of personal property or services, including, but not limited to, transportation, shipping, postage, handling, crating, and packing. Delivery charges shall not include postage charges for the delivery of direct mail when the postage charge is passed on dollar-for-dollar without being marked up to the purchaser of the direct mail and separately stated on an invoice or other similar billing document given to the purchaser.
11. "Detailed telecommunications billing service" means an ancillary service of separately stating information pertaining to individual calls on a customer's billing statement.

    (11.1) "Dietary supplement" means any product, other than tobacco, intended to supplement the diet that:

    1. Contains one or more of the following dietary ingredients:
       1. A vitamin;
       2. A mineral;
       3. An herb or other botanical;
       4. An amino acid;
       5. A dietary substance for use by humans to supplement the diet by increasing the total dietary intake; or
       6. A concentrate, metabolite, constituent, extract, or combination of any ingredient described in this subparagraph;
    2. Is intended for ingestion in tablet, capsule, powder, softgel, gelcap, or liquid form, or if not intended for ingestion in such a form, is not represented as conventional food and is not represented for use as a sole item of a meal or of the diet; and
    3. Is required to be labeled as a dietary supplement, identifiable by the "Supplements Facts" box found on the label as required pursuant to 21 C.F.R. Section 101.36.
12. "Direct mail" means printed material delivered or distributed by United States mail or other delivery service to a mass audience or to addressees on a mailing list provided by the purchaser or at the direction of the purchaser when the costs of the items are not billed directly to the recipients. Direct mail includes tangible personal property supplied directly or indirectly by the purchaser to the direct mail seller for inclusion in the package containing the printed material. Direct mail does not include multiple items of printed material delivered to a single address.
13. "Directory assistance" means an ancillary service of providing telephone number information or address information, or both.
14. "Drug" means a compound, substance, or preparation, and any component of a compound, substance, or preparation, other than food and food ingredients, dietary supplements, or alcoholic beverages:
    1. Recognized in the official United States Pharmacopoeia, official Homeopathic Pharmacopoeia of the United States, or official National Formulary, or supplement to any of them;
    2. Intended for use in the diagnosis, cure, mitigation, treatment, or prevention of disease; or
    3. Intended to affect the structure or any function of the body.
15. "Durable medical equipment" means equipment including repair and replacement parts for the same, but does not include mobility enhancing equipment, which:
    1. Can withstand repeated use;
    2. Is primarily and customarily used to serve a medical purpose;
    3. Generally is not useful to a person in the absence of illness or injury; and
    4. Is not worn in or on the body.
16. "Food and food ingredients" means substances, whether in liquid, concentrated, solid, frozen, dried, or dehydrated form, that are sold for ingestion or chewing by humans and are consumed for their taste or nutritional value. Food and food ingredients shall not include alcoholic beverages, dietary supplements, or tobacco.

    (16.1) "Jet fuel" means any form of fuel that is designed for or used in the operation of aircraft powered by jet turbine or turboprop engines, including but not limited to Jet-A, and excludes aviation gasoline designed for or used in piston engines, including but not limited to avgas.

17. "Lease or rental" means any transfer of possession or control of tangible personal property for a fixed or indeterminate term for consideration. A lease or rental may include future options to purchase or extend. Lease or rental includes agreements covering motor vehicles and trailers where the amount of consideration may be increased or decreased by reference to the amount realized upon sale or disposition of the property as defined in 26 U.S.C. Section 7701(h)(1). Lease or rental shall not include:
    1. A transfer of possession or control of property under a security agreement or deferred payment plan that requires the transfer of title upon completion of the required payments;
    2. A transfer of possession or control of property under an agreement that requires the transfer of title upon completion of required payments and payment of an option price does not exceed the greater of $100.00 or 1 percent of the total required payments; or
    3. Providing tangible personal property along with an operator for a fixed or indeterminate period of time. A condition of this exclusion is that the operator is necessary for the equipment to perform as designed. For the purpose of this subparagraph, an operator must do more than maintain, inspect, or install the tangible personal property.
18. "Load and leave" means delivery to the purchaser by use of a tangible storage media where the tangible storage media is not physically transferred to the purchaser.

    (18.1) "Marketplace facilitator" means a person that contracts with a seller in exchange for any form of consideration to make available or facilitate a retail sale that is taxable under this chapter on behalf of such seller by directly or through any agreement or arrangement with another person:

    1. Providing a service that makes available or facilitates such retail sale in any manner, including, but not limited to, promoting, marketing, advertising, taking orders or reservations for, providing the physical or electronic infrastructure that brings purchasers and marketplace sellers together for, or otherwise similarly assisting the seller in making such retail sale, or transmitting or otherwise similarly communicating the offer and acceptance between the marketplace seller and the purchaser for, or otherwise similarly assisting the seller for such retail sale, but excluding merely processing the payments for such retail sale; and
    2. Collecting, charging, processing, or otherwise similarly facilitating payment for such retail sale on behalf of the marketplace seller.

    (18.2) "Marketplace seller" means a person that conducts a retail sale through or facilitated by any physical or electronic marketplace or platform operated directly or indirectly by a marketplace facilitator, regardless of whether such marketplace seller is required to be registered with the department pursuant to Code Section 48-8-59.

19. "Mobile wireless service" means a telecommunications service that is transmitted, conveyed, or routed regardless of the technology used, by which the origination or termination points, or both, of the transmission, conveyance, or routing are not fixed, including, by way of example only, telecommunications services that are provided by a commercial mobile radio service provider.
20. "Mobility enhancing equipment" means equipment including repair and replacement parts to the same, but does not include durable medical equipment, which:

    (20.1) "Over-the-counter drug" means a drug that contains a label that identifies the product as a drug as required by 21 C.F.R. Section 201.66. The over-the-counter drug label includes:

    1. Is primarily and customarily used to provide or increase the ability to move from one place to another and which is appropriate for use either in a home or a motor vehicle;
    2. Is not generally used by persons with normal mobility; and
    3. Does not include any motor vehicle or equipment on a motor vehicle normally provided by a motor vehicle manufacturer.
    4. A "Drug Facts" panel; or
    5. A statement of the "active ingredient(s)" with a list of those ingredients contained in the compound, substance, or preparation.
21. "Place of primary use" means the street address representative of where the customer's use of the telecommunications service primarily occurs, which must be the residential street address or the primary business street address of the customer. In the case of mobile telecommunications services, place of primary use must be within the licensed service area of the home service provider.
22. "Prepaid calling service" means the right to access exclusively telecommunications services, which must be paid for in advance and which enables the origination of calls using an access number or authorization code, whether manually or electronically dialed, and that is sold in predetermined units or dollars of which the number declines with use in a known amount.
23. "Prepaid local tax" means any local sales and use tax which is levied on the sale or use of motor fuel and imposed in an area consisting of less than the entire state, however authorized, including, but not limited to, such taxes authorized by or pursuant to constitutional amendment; by or pursuant to Section 25 of an Act approved March 10, 1965 (Ga. L. 1965, p. 2243), as amended, known as the "Metropolitan Atlanta Rapid Transit Authority Act of 1965"; or by or pursuant to Article 2, 2A, 3, or 4 of this chapter. Such tax is based on the same average retail sales price as compiled by the Energy Information Agency of the United States Department of Energy, the Oil Pricing Information Service, or a similar reliable published index less taxes imposed under Code Section 48-9-3 and all local sales and use or excise taxes levied on motor fuel. Such price shall be used to compute the prepaid sales tax rate for local jurisdictions by multiplying such retail price by the applicable rate imposed by the jurisdiction. The person collecting and reporting the prepaid local tax for the local jurisdiction shall provide a schedule as to which jurisdiction these collections relate. This determination shall be based upon the shipping papers of the conveyance that delivered the motor fuel to the dealer or consumer in the local jurisdiction. A seller may rely upon the representation made by the purchaser as to which jurisdiction the shipment is bound and prepare shipping papers in accordance with those instructions.
24. Reserved.
25. "Prepaid wireless calling service" means a telecommunications service that provides the right to utilize mobile wireless service as well as other nontelecommunications services including the download of digital products delivered electronically, content, and ancillary services, which must be paid for in advance that is sold in predetermined units or dollars of which the number declines with use in a known amount.
26. Reserved.
27. "Prepared food" means:
    1. Food:
       1. Sold in a heated state or heated by the seller;
       2. With two or more food ingredients mixed or combined by the seller for sale as a single item; or
       3. Sold with eating utensils provided by the seller, including plates, knives, forks, spoons, glasses, cups, napkins, or straws. A plate does not include a container or packaging used to transport the food; and
    2. Prepared food shall not include food:
       1. That is only cut, repackaged, or pasteurized by the seller, and eggs, fish, meat, poultry, and foods containing these raw animal foods requiring cooking by the consumer as in Chapter 3, part 401.11 of the United States Food and Drug Administration Food Code so as to prevent food borne illnesses;
       2. Sold by a seller whose proper primary North American Industrial Classification System code is subsector 311, food manufacturing, except for industry group 3118, bakeries and tortilla manufacturing, if sold without eating utensils provided by the seller; or
       3. Sold by a seller whose proper primary North American Industrial Classification System code is industry group 3121, beverage manufacturing.
28. "Prescription" means an order, formula, or recipe issued in any form of oral, written, electronic, or other means of transmission by a duly licensed practitioner authorized by the laws of this state.

    (28.1) "Prewritten computer software" means computer software, including prewritten upgrades, which is not designed and developed by the author or other creator to the specifications of a specific purchaser. The combining of two or more prewritten computer software programs or prewritten portions thereof does not cause the combination to be other than prewritten computer software. Prewritten computer software includes software designed and developed by the author or other creator to the specifications of a specific purchaser when it is sold to a person other than the specific purchaser. Where a person modifies or enhances computer software of which the person is not the author or creator, the person shall be deemed to be the author or creator only of such person's modifications or enhancements. Prewritten computer software or a prewritten portion thereof that is modified or enhanced to any degree, where such modification or enhancement is designed and developed to the specifications of a specific purchaser, remains prewritten computer software; provided, however, that where there is a reasonable, separately stated charge or an invoice or other statement of the price given to the purchaser for such modification or enhancement, such modification or enhancement shall not constitute prewritten computer software.

29. "Prosthetic device" means a replacement, corrective, or supportive device including repair and replacement parts for the same worn on or in the body to:
    1. Artificially replace a missing portion of the body;
    2. Prevent or correct physical deformity or malfunction; or
    3. Support a weak or deformed portion of the body.

       Prosthetic device shall not include hearing aids.

30. "Purchase price" applies to the measure subject to use tax and has the same meaning as sales price.
31. "Retail sale" or a "sale at retail" means any sale, lease, or rental for any purpose other than for resale, sublease, or subrent. Sales for resale must be made in strict compliance with the commissioner's rules and regulations. Any dealer making a sale for resale which is not in strict compliance with the commissioner's rules and regulations shall be liable for and shall pay the tax. The terms "retail sale" or "sale at retail" include but are not limited to the following:
    1. Except as otherwise provided in this chapter, the sale of natural or artificial gas, oil, electricity, solid fuel, transportation, local telephone services, alcoholic beverages, and tobacco products, when made to any purchaser for purposes other than resale;
    2. The sale or charges for any room, lodging, or accommodation furnished to transients by any hotel, inn, tourist camp, tourist cabin, or any other place in which rooms, lodgings, or accommodations are regularly furnished to transients for a consideration. This tax shall not apply to rooms, lodgings, or accommodations supplied for a period of 90 continuous days or more;
    3. Sales of tickets, fees, or charges made for admission to places of amusement, sports, or entertainment, including, but not limited to:
       1. Billiard and pool rooms;
       2. Bowling alleys;
       3. Amusement devices;
       4. Musical devices;
       5. Theaters;
       6. Opera houses;
       7. Moving picture shows;
       8. Vaudeville;
       9. Amusement parks;
       10. Athletic contests, including, but not limited to, wrestling matches, prize fights, boxing and wrestling exhibitions, football games, and baseball games;
       11. Skating rinks;
       12. Race tracks;
       13. Public bathing places;
       14. Public dance halls; and
       15. Any other place at which any exhibition, display, amusement, or entertainment is offered to the public or any other place where an admission fee is charged;
    4. Charges made for participation in games and amusement activities;
    5. Sales of tangible personal property to persons for resale when there is a likelihood that the state will lose tax funds due to the difficulty of policing the business operations because:
       1. Of the operation of the business;
       2. Of the very nature of the business;
       3. Of the turnover of so-called independent contractors;
       4. Of the lack of a place of business in which to display a certificate of registration;
       5. Of the lack of a place of business in which to keep records;
       6. Of the lack of adequate records;
       7. The persons are minors or transients;
       8. The persons are engaged in essentially service businesses; or
       9. Of any other reasonable reason.

       The commissioner may promulgate rules and regulations requiring vendors of persons described in this subparagraph to collect the tax imposed by this article on the retail price of the tangible personal property. The commissioner shall refuse to issue certificates of registration and may revoke certificates of registration issued in violation of his rules and regulations;

    6. Charges, which applied to sales of telephone service, made for local exchange telephone service, except coin operated telephone service, except as otherwise provided in subparagraph (G) of this paragraph; or
    7. If the price is attributable to products that are taxable and products that are nontaxable, the portion of the price attributable to the nontaxable products may be subject to tax unless the provider can identify by reasonable and verifiable standards such portion from its books and records that are kept in the regular course of business for other purposes, including, but not limited to, nontax purposes. If the price is attributable to products that are subject to tax at different tax rates, the total price may be treated as attributable to the products subject to tax at the highest tax rate unless the provider can identify by reasonable and verifiable standards the portion of the price attributable to the products subject to tax at the lower rate from the provider's books and records that are kept in the regular course of business for other purposes, including, but not limited to, nontax purposes.
32. "Retailer" means every person making sales at retail or for distribution, use, consumption, or storage for use or consumption in this state and has the same meaning as "seller" in Code Section 48-8-161.
33. 1. "Sale" means any transfer of title or possession, transfer of title and possession, exchange, barter, lease, or rental, conditional or otherwise, in any manner or by any means of any kind of tangible personal property for a consideration except as otherwise provided in subparagraph (B) of this paragraph and includes, but is not limited to:
       1. The fabrication of tangible personal property for consumers who directly or indirectly furnish the materials used in such fabrication;
       2. The furnishing, repairing, or serving for a consideration of any tangible personal property consumed on the premises of the person furnishing, repairing, or serving the tangible personal property; or
       3. A transaction by which the possession of property is transferred but the seller retains title as security for the payment of the price.
    2. Notwithstanding a dealer's physical presence, in the case of a motor vehicle retail sale, excluding lease or rental, the taxable situs of the transaction for the purposes of collecting local sales and use taxes shall be the county of motor vehicle registration of the purchaser.
34. 1. "Sales price" applies to the measure subject to sales tax and means the total amount of consideration, including cash, credit, property, and services, for which personal property or services are sold, leased, or rented, valued in money, whether received in money or otherwise without any deduction for the following:
       1. The seller's cost of the property sold;
       2. The cost of materials used, labor, or service cost, interest, losses, all costs of transportation to the seller, all taxes imposed on the seller, and any other expense of the seller;
       3. Charges by the seller for any services necessary to complete the sale; and
       4. Delivery charges.
    2. Sales price shall not include:
       1. Discounts, including cash, term, or coupons that are not reimbursed by a third party that are allowed by a seller and taken by a purchaser on a sale;
       2. Interest, financing, and carrying charges from credit extended on the sale of personal property or services, if the amount is separately stated on the invoice, bill of sale, or similar document given to the purchaser;
       3. Any taxes legally imposed directly on the consumer that are separately stated on the invoice, bill of sale, or similar document given to the purchaser;
       4. Installation charges if they are separately stated on the invoice, billing, or similar document given to the purchaser;
       5. Telecommunications nonrecurring charges if they are separately stated on the invoice, billing, or similar document; and
       6. Credit for any trade-in.
    3. Sales price shall include consideration received by the seller from third parties if:
       1. The seller actually receives consideration from a party other than the purchaser and the consideration is directly related to a price reduction or discount on the sale;
       2. The seller has an obligation to pass the price reduction or discount through to the purchaser;
       3. The amount of the consideration attributable to the sale is fixed and determinable by the seller at the time of the sale of the item to the purchaser; and
       4. One of the following criteria is met:
    4. The purchaser presents a coupon, certificate, or other documentation to the seller to claim a price reduction or discount where the coupon, certificate, or documentation is authorized, distributed, or granted by a third party with the understanding that the third party will reimburse any seller to whom the coupon, certificate, or documentation is presented;
    5. The purchaser identifies himself or herself to the seller as a member of a group or organization entitled to a price reduction or discount; provided, however, that a preferred customer card that is available to any patron shall not constitute membership in such a group; or
    6. The price reduction or discount is identified as a third-party price reduction or discount on the invoice received by the purchaser or on a coupon, certificate, or other documentation presented by the purchaser.
35. "Storage" means any keeping or retention in this state of tangible personal property for use or consumption in this state or for any purpose other than sale at retail in the regular course of business.
36. "Streamlined sales tax agreement" means the Streamlined Sales and Use Tax Agreement under Code Section 48-8-162.
37. "Tangible personal property" means personal property that can be seen, weighed, measured, felt, or touched or that is in any other manner perceptible to the senses. Tangible personal property includes electricity, water, gas, steam, and prewritten computer software. Tangible personal property does not mean stocks, bonds, notes, insurance, or other obligations or securities.
38. "Telecommunications nonrecurring charges" means an amount billed for the installation, connection, change, or initiation of telecommunications service received by the customer.
39. "Telecommunications service" means the electronic transmission, conveyance, or routing of voice, data, audio, video, or any other information or signals to a point, or between or among points. The term telecommunications service includes such transmission, conveyance, or routing in which computer processing applications are used to act on the form, code, or protocol of the content for purposes of transmission, conveyance, or routing without regard to whether such service is referred to as voice over Internet protocol services or is classified by the Federal Communications Commission as enhanced or value added. Telecommunications service shall not include:
    1. Data processing and information services that allow data to be generated, acquired, stored, processed, or retrieved and delivered by an electronic transmission to a purchaser where such purchaser's primary purpose for the underlying transaction is the processed data or information;
    2. Installation or maintenance of wiring or equipment on a customer's premises;
    3. Tangible personal property;
    4. Advertising, including but not limited to directory advertising;
    5. Billing and collection services provided to third parties;
    6. Internet access service;
    7. Radio and television audio and video programming services, regardless of the medium, including the furnishing of transmission, conveyance, and routing of such services by the programming service provider. Radio and television audio and video programming services shall include but not be limited to cable service as defined in 47 U.S.C. Section 522(6) and audio and video programming services delivered by commercial mobile radio service providers, as defined in 47 C.F.R. Section 20.3;
    8. Ancillary services; or
    9. Digital products delivered electronically, including but not limited to software, music, video, reading materials, or ring tones.

    (39.1) "Tobacco" means cigarettes, cigars, chewing or pipe tobacco, or any other item that includes tobacco.

40. "Use" means the exercise of any right or power over tangible personal property incident to the ownership of the property including, but not limited to, the sale at retail of the property in the regular course of business.
41. "Use tax" includes the use, consumption, distribution, and storage of tangible personal property as defined in this article.
42. "Vertical service" means an ancillary service that is offered in connection with one or more telecommunications services, which offers advanced calling features that allow customers to identify callers and to manage multiple calls and call connections, including conference bridging services.
43. "Voice mail service" means an ancillary service that enables the customer to store, send, or receive recorded messages. Voice mail service does not include any vertical services that the customer may be required to have in order to utilize the voice mail service.

(Ga. L. 1951, p. 360, §§ 3, 4; Ga. L. 1960, p. 153, § 3; Ga. L. 1971, p. 85, § 1; Ga. L. 1978, p. 1664, § 1; Code 1933, § 91A-4501, enacted by Ga. L. 1978, p. 309, § 2; Ga. L. 1979, p. 5, §§ 81-84; Ga. L. 1980, p. 10, § 22; Ga. L. 1982, p. 3, § 48; Ga. L. 1990, p. 1243, § 1; Ga. L. 1992, p. 1521, § 1; Ga. L. 1994, p. 928, § 4A; Ga. L. 1995, p. 10, § 48; Ga. L. 1996, p. 220, § 7; Ga. L. 1998, p. 124, § 3; Ga. L. 2002, p. 415, § 48; Ga. L. 2002, p. 975, § 1; Ga. L. 2003, p. 355, § 3; Ga. L. 2003, p. 665, § 10; Ga. L. 2005, p. 788, § 1/HB 22; Ga. L. 2006, p. 59, § 1/HB 111; Ga. L. 2007, p. 309, § 1/HB 219; Ga. L. 2009, p. 8, § 48/SB 46; Ga. L. 2010, p. 662, § 1/HB 1221; Ga. L. 2011, p. 38, §§ 2, 3/HB 168; Ga. L. 2011, p. 674, §§ 1-2, 1-3/HB 117; Ga. L. 2012, p. 257, § 6-1/HB 386; Ga. L. 2012, p. 694, § 3/HB 729; Ga. L. 2013, p. 141, § 48/HB 79; Ga. L. 2014, p. 700, § 1/HB 816; Ga. L. 2014, p. 866, § 48/SB 340; Ga. L. 2015, p. 5, § 48/HB 90; Ga. L. 2015, p. 236, § 5-2/HB 170; Ga. L. 2016, p. 864, § 48/HB 737; Ga. L. 2017, p. 154, § 1/HB 117; Ga. L. 2018, p. 259, § 1/HB 61; Ga. L. 2018, p. 1112, § 48/SB 365; Ga. L. 2018, Ex. Sess., p. ES7, § 3-1/HB 5EX; Ga. L. 2019, p. 282, § 1/HB 182; Ga. L. 2020, p. 1, § 1/HB 276.)

The 2015 amendments. The first 2015 amendment, effective March 13, 2015, part of an Act to revise, modernize, and correct the Code, deleted paragraph (30.1) which was repealed and revised punctuation in paragraphs (37), (39), and (43). The second 2015 amendment, effective July 1, 2015, substituted "as compiled by the Energy Information Agency of the United States Department of Energy, the Oil Pricing Information Service, or a similar reliable published index less taxes imposed under Code Section 48-9-3 and all local sales and use or excise taxes levied on motor fuel" for "as set forth in subparagraph (b)(2)(B) of Code Section 48-9-14" in the second sentence of paragraph (23); and substituted "Reserved." for the former provisions of paragraph (24), which read: " 'Prepaid state tax' means the tax levied under Code Section 48-8-30 in conjunction with Code Section 48-8-3.1 and Code Section 48-9-14 on the retail sale of motor fuels for highway use and collected prior to that retail sale. This tax is based upon the average retail sales price as set forth in Code Section 48-9-14." See Editor's notes for applicability.

The 2016 amendment, effective May 3, 2016, part of an Act to revise, modernize, and correct the Code, revised language and punctuation in this Code section.

The 2017 amendment, effective May 1, 2017, substituted "places of" for ", or voluntary contributions made to places of," in subparagraph (31)(C). See Editor's notes for applicability.

The 2018 amendments. The first 2018 amendment, effective January 1, 2019, added subparagraphs (8)(M.1) and (8)(M.2). See Editor's notes for applicability. The second 2018 amendment, effective May 8, 2018, part of an Act to revise, modernize, and correct the Code, revised punctuation in the first sentences of paragraph (10), subparagraph (31)(C), and division (31)(C)(x).

The 2018 Ex. Sess. amendment, effective December 1, 2018, added paragraph (16.1).

The 2019 amendment, effective January 1, 2020, in subparagraph (8)(M.1), substituted "$100,000.00" for "$250,000.00", and inserted "conducting" in the middle. See Editors notes for applicability.

The 2020 amendment, effective April 1, 2020, added subparagraph (8)(M.3); and added paragraphs (18.1) and (18.2). See Editor's notes for applicability.

- Limitations on contracting with state agencies by dealers refusing to pay sales tax, § 50-5-82.

- The amendment of this Code section by Ga. L. 2003, p. 355, § 3, irreconcilably conflicted with and was treated as superseded by Ga. L. 2003, p. 665, § 10. See County of Butts v. Strahan, 151 Ga. 417 (1921).

Pursuant to Code Section 28-9-5, in 2012, "This subparagraph shall take effect December 31, 2012, and shall apply to sales made, uses occurring, and services rendered on or after December 31, 2012, without regard to the date" was substituted for "This subparagraph shall take effect 90 days after the effective date of this Act and shall apply to sales made, uses occurring, and services rendered on or after the effective date of this subparagraph without regard to the date" in subparagraph (8)(M)(ii).

- Ga. L. 1992, p. 1521, § 4, not codified by the General Assembly, provides: "This Act [which amended this Code section] shall stand repealed in its entirety on January 1, 1996, and shall be void and of no effect and the provisions affected by this Act shall be specifically revived as such provisions stood before the enactment of this Act, as amended by laws other than this Act."

Ga. L. 1994, p. 834, § 4, not codified by the General Assembly, repeals Ga. L. 1992, p. 1521, § 4, which had provided for the repeal of this Code section as affected by that 1992 Act effective January 1, 1996.

Ga. L. 1994, p. 928, § 1, not codified by the General Assembly, provides: "This Act shall be known and may be cited as the 'Georgia Business Expansion Support Act of 1994.'"

Ga. L. 2003, p. 665, § 1, not codified by the General Assembly, provides that: "This Act shall be known and may be cited as the 'State and Local Tax Revision Act of 2003.'"

Ga. L. 2011, p. 674 provided for the automatic repeal of subparagraph (31)(H) and paragraphs (30.1) and (34.1), effective June 30, 2014.

Ga. L. 2012, p. 257, § 7-1(h)/HB 386, not codified by the General Assembly, provides: "Tax, penalty, and interest liabilities and refund eligibility for prior taxable years shall not be affected by the passage of this Act and shall continue to be governed by the provisions of general law as it existed immediately prior to the effective date of the relevant portion of this Act." This Act became effective October 1, 2012.

Ga. L. 2012, p. 257, § 7-1(i)/HB 386, not codified by the General Assembly, provides: "This Act shall not abate any prosecution, punishment, penalty, administrative proceedings or remedies, or civil action related to any violation of law committed prior to the effective date of the relevant portion of this Act." This Act became effective October 1, 2012.

Ga. L. 2012, p. 257, § 7-2/HB 386, not codified by the General Assembly, provides for severability.

Ga. L. 2015, p. 236, § 8-1/HB 170, not codified by the General Assembly, provides that: "This Act shall be known and may be cited as the 'Transportation Funding Act of 2015.' "

Ga. L. 2015, p. 236, § 8-2/HB 170, not codified by the General Assembly, provides that: "It is the intention of the General Assembly, subject to appropriations and other constitutional obligations of this state, that year to year revenue increases be prioritized to fund education, transportation, and health care in this state."

Ga. L. 2015, p. 236, § 9-1(b)/HB 170, not codified by the General Assembly, provides that: "Tax, penalty, and interest liabilities and refund eligibility for prior taxable years shall not be affected by the passage of this Act and shall continue to be governed by the provisions of Title 48 of the Official Code of Georgia Annotated as it existed immediately prior to the effective date of this Act." This Act became effective July 1, 2015.

Ga. L. 2017, p. 154, § 2/HB 117, not codified by the General Assembly, provides that the amendment to this Code section shall apply to all sales made on or after July 1, 2017.

Ga. L. 2018, p. 259, § 3/HB 61, not codified by the General Assembly, provides that the addition of subparagraphs (8)(M.1) and (8)(M.2) shall apply to all sales made on or after January 1, 2019.

Ga. L. 2019, p. 282, § 3/HB 182, not codified by the General Assembly, provides that the amendment to this Code section shall apply to all sales made on or after January 1, 2020.

Ga. L. 2020, p. 1, § 3/HB 276, not codified by the General Assembly, provides, in part, that the addition of subparagraph (8)(M.3) and paragraphs (18.1) and (18.2) shall apply to all sales occurring on or after April 1, 2020.

- For article, "Clarification Needed in Georgia Retail Sales and Use Tax Statute," see 41 Mercer L. Rev. 1 (1989). For article, "Revenue and Taxation: Amend Titles 48, 2, 28, 33, 36, 46, and 50 of the Official Code of Georgia Annotated, Relating Respectively to Revenue and Taxation, Agriculture, the General Assembly, Insurance, Local Government, Public Utilities, and State Government," see 28 Georgia St. U. L. Rev. 217 (2011). For article on the 2012 amendment of this Code section, see 29 Georgia St. U. L. Rev. 112 (2012). For article on the 2015 amendment of this Code section, see 32 Georgia St. U. L. Rev. 261 (2015). For annual survey on administrative law, see 69 Mercer L. Rev. 15 (2017). For article on the 2018 amendment of this Code section, see 35 Ga. St. U. L. Rev. 187 (2018). For annual survey on administrative law, see 70 Mercer L. Rev. 1 (2018). For annual survey on state and local taxation: a two-year survey, see 71 Mercer L. Rev. 279 (2019). For note on the 1994 amendment of this Code section, see 11 Georgia St. U. L. Rev. 249 (1994). For note on the 2003 amendment to this Code section, see 20 Georgia St. U. L. Rev. 233 (2003). For comment on Colonial Stores v. Undercofler, 223 Ga. 105, 153 S.E.2d 549 (1967), see 4 Ga. St. B. J. 132 (1967).

ANALYSIS

• General Consideration
• Business
• Cost Price
• Dealer
• Lease or Rental
• Retail Sale
• Sale
• Sales Price
• Tangible Personal Property
• Use Tax

General Consideration

Dealer's representational standing to claim refund.

- Because a dealer had statutorily granted representational standing under amended O.C.G.A. § 48-2-35.1 to recover wrongfully paid sales taxes from the state on behalf of the dealer's customers, and the amendment was procedural and could be applied retroactively, the dealer had standing to file a claim for any taxes for periods before the statute was amended. New Cingular Wireless PCS, LLC v. Dep't of Revenue, 308 Ga. 729, 843 S.E.2d 431 (2020).

Cited in International Computer Group, Inc. v. Data Gen. Corp., 159 Ga. App. 169, 283 S.E.2d 12 (1981); Strickland v. W.E. Ross & Sons, 251 Ga. 324, 304 S.E.2d 719 (1983).

Business

Intent is to tax sales carried on as a business or occupation.

- From Ga. L. 1951, p. 360 (see now O.C.G.A. Art. 1, Ch. 8, T. 48), taken as a whole, the intention is clear that it is the gross proceeds from retail sales carried on as a business or occupation which is designed to be taxed. Novak v. Redwine, 89 Ga. App. 755, 81 S.E.2d 222 (1954).

No definitive distinction can be drawn between the definition of "business" and the term's common and accepted meaning. Novak v. Redwine, 89 Ga. App. 755, 81 S.E.2d 222 (1954).

Definition of "business" is closely identifiable with the definition of that word given by Black's Law Dictionary, which defines business as "that which occupies the time, attention, and labor of men for the purpose of a livelihood or profit," and which is the commonly accepted meaning of the term. Novak v. Redwine, 89 Ga. App. 755, 81 S.E.2d 222 (1954).

Words "engaged in business" imply an element of continuity or habitual practice. Novak v. Redwine, 89 Ga. App. 755, 81 S.E.2d 222 (1954).

Definition of "business" does not say "any act engaged in for gain," but rather, "any activity." Novak v. Redwine, 89 Ga. App. 755, 81 S.E.2d 222 (1954).

- Since revenue statutes are to be construed strictly so as to resolve doubt in favor of the taxpayer, and since their meaning is not to be extended by implication, and under this rule, any doubt as to whether the definition of "business" as "any activity engaged in" was meant to narrow the word down to include a single transaction, instead of the word's ordinary meaning of continuity of transactions, should be resolved in favor of the taxpayer. Novak v. Redwine, 89 Ga. App. 755, 81 S.E.2d 222 (1954).

- Casual and isolated sale made by one not engaged in the business of selling tangible personal property at retail is not taxable. Novak v. Redwine, 89 Ga. App. 755, 81 S.E.2d 222 (1954); State v. Dyson, 89 Ga. App. 791, 81 S.E.2d 217 (1954).

- Ga. L. 1951, p. 360 (see now O.C.G.A. Art. 1, Ch. 8, T. 48) does not define or even mention "casual sales." The term comes from case law and revenue regulations. Newscopters, Inc. v. Blackmon, 125 Ga. App. 130, 186 S.E.2d 759 (1971).

- Sale of business fixtures and equipment, after an owner has ceased to do business, is not a transaction by one engaged in the business of buying and selling such business fixtures and equipment, and is not taxable. Novak v. Redwine, 89 Ga. App. 755, 81 S.E.2d 222 (1954).

"Cost price" may be taken as synonymous with the term "sales price," insofar as "sales price" relates to the sale of tangible personal property rather than to the sale of services. Colonial Pipeline Co. v. Undercofler, 115 Ga. App. 58, 153 S.E.2d 592 (1967).

- When the vendor furnishes services incidental to the sale of tangible personal property, such as delivery to the purchaser, and no additional charge is made for the services so as to constitute a separate sale of services, the services are included in the sale price or cost price of the property for the purpose of computing the applicable sales or use tax. Colonial Pipeline Co. v. Undercofler, 115 Ga. App. 58, 153 S.E.2d 592 (1967).

Person who is president and treasurer of a corporation which sells at retail is a dealer. Bunge v. State, 149 Ga. App. 712, 256 S.E.2d 23 (1979).

- Contractor who buys building material is not one who buys and sells - a trader. The contractor is not a dealer, or one who habitually and constantly, as in business, deals in and sells any given commodity. The contractor is a user and consumer of such materials and is liable for sales and use tax, even though title to materials finally vests in the customer. J.W. Meadors & Co. v. State, 89 Ga. App. 583, 80 S.E.2d 86 (1954).

"Rental" is the equivalent of "resale." Undercofler v. Macon Linen Serv., Inc., 114 Ga. App. 231, 150 S.E.2d 703 (1966).

- Sale or charges for any room or rooms, lodgings, or accommodations furnished to transients encompasses whatever is rented, whether one room or several, whether bare or elaborately appointed. Atlanta Americana Motor Hotel Corp. v. Undercofler, 222 Ga. 295, 149 S.E.2d 691 (1966).

Lease of advertising signs is taxable. Register Mobile Adv., Inc. v. Strickland, 242 Ga. 604, 250 S.E.2d 468 (1978).

Leases of tangible personal property are to be treated the same as sales under sales and use tax laws. Strickland v. Sperry Rand Corp., 248 Ga. 535, 285 S.E.2d 1 (1981).

All retail sales except those specifically exempted are taxable under Ga. L. 1951, p. 360 (see now O.C.G.A. Art. 1, Ch. 8, T. 48). Undercofler v. VFW Post 4625, 110 Ga. App. 711, 139 S.E.2d 776 (1964).

- Definition of a retail sale as a sale to a consumer or to any person for any purpose other than for resale in the form of tangible personal property does not confine retail sales to sales made to consumers only. The chief element of the definition is that such a sale shall not be followed by a resale, or another retail sale, but shall be the last of a possible series of sales. Craig-Tourial Leather Co. v. Reynolds, 87 Ga. App. 360, 73 S.E.2d 749 (1952).

- Although all costs of a company's operations are reflected in the rental or contract price charged the company's customers, including the costs of the equipment used by the company for storage, this circumstance does not in itself operate to show a resale or rental of these items so as to render the items' sale to the company other than a taxable transaction. Undercofler v. Macon Linen Serv., Inc., 114 Ga. App. 231, 150 S.E.2d 703 (1966).

- Sale is completed in this state when the customer acquires the right to the property even though the delivery of the property is delayed and even though actual delivery does not take place in the state. Meade Corp. v. Blackmon, 129 Ga. App. 526, 199 S.E.2d 839 (1973).

- Horse show is an event of sports or of entertainment, and that it was held by or sponsored by a charitable organization with tax-exempt status does not relieve it from the payment of the tax. Atlanta Hunter-Jumper Classic, Inc. v. Blackmon, 125 Ga. App. 38, 186 S.E.2d 434 (1971).

- There is no authority in Ga. L. 1951, p. 360 (see now O.C.G.A. Art. 1, Ch. 8, T. 48) to exempt portions of amounts required to be paid to reserve admissions to a sporting event simply because a portion of the amount is designated by the sponsor in the sponsor's advertisements as "tax deductible." Atlanta Hunter-Jumper Classic, Inc. v. Blackmon, 125 Ga. App. 38, 186 S.E.2d 434 (1971).

Sale of steel dies to a manufacturer is not a personal service transaction when such dies are used by the manufacturer until disposed of. Mead Corp. v. Strickland, 247 Ga. 495, 276 S.E.2d 586 (1981).

- Term "retail sale" applies to the sale and purchase of chances or plays in a lottery known as the numbers game, which tickets or chances are taxable under Ga. L. 1951, p. 360 (see now O.C.G.A. Art. 1, Ch. 8, T. 48). Chilivis v. Fleming, 139 Ga. App. 295, 228 S.E.2d 178 (1976).

- Operation of coin operated gaming devices known as slot machines or one-armed bandits by depositing a coin therein is a transaction amounting to a taxable sale. Undercofler v. VFW Post 4625, 110 Ga. App. 711, 139 S.E.2d 776 (1964).

Slot machines are not excluded from this section merely because it amounts to an illegal transaction. Undercofler v. American Legion Post 69, 112 Ga. App. 27, 143 S.E.2d 684 (1965).

- Ga. L. 1951, p. 360 (see now O.C.G.A. Art. 1, Ch. 8, T. 48) authorizes the commissioner to treat some wholesale transactions as retail sales and to make regulations requiring certain sellers to collect sales tax on wholesale transactions. Independent Publishing Co. v. Hawes, 119 Ga. App. 858, 168 S.E.2d 904 (1969).

- Transactions between merchant and customers with reference to trading stamps and premium merchandise are sales since stamps issued to customers in consideration of purchases represent right to premium merchandise. The purchase of premium merchandise by the merchant is a purchase for purposes of resale, and is therefore not taxable. Colonial Stores v. Undercofler, 223 Ga. 105, 153 S.E.2d 549 (1967), commented on in 4 Ga. St. B.J. 132 (1967).

- Brewing company must pay use tax on advertising materials that accompany malt liquor transferred to distributors because the absence of a separate charge for the advertising indicates that the advertising does not fall within the resale exemption and because the advertising materials will in fact never be sold at any time during the distribution chain. Carling Brewing Co. v. Blackmon, 131 Ga. App. 211, 205 S.E.2d 492 (1974).

- Ga. L. 1951, p. 360 (see now O.C.G.A. Art. 1, Ch. 8, T. 48) imposes a tax on the sale of airline meals included in the in-state sale of a ticket to a passenger, but not on the purchase of the meals from a supplier by the airline since such purchases are held for resale to passengers. Undercofler v. Eastern Air Lines, 221 Ga. 824, 147 S.E.2d 436 (1966).

- Grant of the Georgia Department of Revenue's motion to dismiss the appellants' complaint seeking a refund under O.C.G.A. § 48-2-35 of state sales tax paid was affirmed because the appellants failed to comply with a regulation that, before seeking a refund on behalf of the appellants' customers under § 48-2-35, the appellants were required to affirmatively show that the alleged erroneously or illegally collected tax had been refunded by the appellants to their customers, which the appellants admittedly had not done.

Sale

Tax is on total consideration, regardless of number of sources.

- It is the consideration for the transfer of personal property which is taxed. The consideration may come from more than one source, but the total consideration is the total of all amounts. The total amount, or gross sales price, is taxable. Davis v. Chilivis, 142 Ga. App. 679, 237 S.E.2d 2 (1977).

- When Ga. L. 1951, p. 360, § 8 is read in pari materia with Ga. L. 1951, p. 360, § 3 it is apparent that the first use referred to in Ga. L. 1951, p. 360, § 8 means the first use in this state. Ingalls Iron Works Co. v. Chilivis, 237 Ga. 479, 228 S.E.2d 866 (1976), appeal dismissed, 429 U.S. 1081, 97 S. Ct. 1086, 51 L. Ed. 2d 528 (1977).

- Phrase "holding for resale" must be construed to cover those situations when the seller is engaged in the business of selling or leasing property on a continual and habitual basis. Chilivis v. Bradley, 142 Ga. App. 793, 237 S.E.2d 200 (1977).

Judicial sale is not exempt from the tax imposed by Ga. L. 1951, p. 360 (see now O.C.G.A. Art. 1, Ch. 8, T. 48). Hopkins v. West Publishing Co., 106 Ga. App. 596, 127 S.E.2d 849 (1962).

For examples of what constitutes furnishing by consumer of materials used in fabrication see Superior Type, Inc. v. Williams, 98 Ga. App. 89, 105 S.E.2d 14 (1958).

- When a company is denominated as the seller in the company's sales contracts, there must be a sale within the meaning of O.C.G.A. § 48-8-2(8) from the manufacturer to the company so that the company can pass the title to the purchaser, even though the company contends the company is only the sales representative for the manufacturer. Adrian Hous. Corp. v. Collins, 253 Ga. 263, 319 S.E.2d 852 (1984).

Gross sales price of a new product is subject to a sales tax. Southwire Co. v. Chilivis, 139 Ga. App. 329, 228 S.E.2d 295 (1976).

- Charges by a taxpayer to its customers for modifications in equipment sold by the taxpayer to its customers, but retained and used by the taxpayer to manufacture products for the customers, such charges representing the costs to the taxpayer of tax-free services generally obtained from a third party, without any specific charge for the negligible use of materials, are charges for services rendered in remodeling or repairing property sold and are therefore properly excluded from the sales price for tax purposes. Undercofler v. Thompson Indus., Inc., 114 Ga. App. 497, 151 S.E.2d 844 (1966).

- If the imposition of other taxes, such as those on cigarettes, falls upon the consumer or the incident of the sale by the retailer to the consumer they are not included as part of the retail sale price for calculating the sales and use tax. If, however, the tax is imposed at a time prior to the point of retail sale or other consumer transaction, it is an element of the cost of the property sold and must be included as part of the retail sale price for purposes of calculating the sales and use tax. Blackmon v. Coastal Serv., Inc., 125 Ga. App. 28, 186 S.E.2d 441 (1971), aff'd, 229 Ga. 471, 192 S.E.2d 372 (1972).

State cigarette tax imposed by former Code 1933, Ch. 92-22 is not an element of the cost of the property sold and is not, therefore, included in "gross sales" and "sales price" upon which the sales and use tax is calculated. Blackmon v. Coastal Serv., Inc., 125 Ga. App. 28, 186 S.E.2d 441 (1971), aff'd, 229 Ga. 471, 192 S.E.2d 372 (1972).

Federal cigarette tax imposed by Subtitle E, Ch. 52 of the Internal Revenue Code of 1954 is an element of the cost of property sold and is therefore included in "gross sales" and "sales price." Blackmon v. Coastal Serv., Inc., 125 Ga. App. 28, 186 S.E.2d 441 (1971), aff'd, 229 Ga. 471, 192 S.E.2d 372 (1972).

Federal manufacturer's excise tax imposed by § 4061 of the Internal Revenue Code of 1954 is an element of the cost of property sold and is therefore included in gross sales and sale price. Undercofler v. Capital Auto. Co., 111 Ga. App. 709, 143 S.E.2d 206 (1965).

Federal excise tax on gasoline is properly includable as a part of the retail sales price on which the sales and use tax is to be calculated. State v. Thoni Oil Magic Benzol Gas Stations, Inc., 121 Ga. App. 454, 174 S.E.2d 224, aff'd, 226 Ga. 883, 178 S.E.2d 173 (1970).

- Motor fuel taxes imposed by former Code 1933, Ch. 92-14 are levied upon the incident of the sale to the consumer and should not be included as a part of the retail sales price for calculating the sales and use tax. State v. Thoni Oil Magic Benzol Gas Stations, Inc., 121 Ga. App. 454, 174 S.E.2d 224, aff'd, 226 Ga. 883, 178 S.E.2d 173 (1970).

- Discounts to employees on the price of meals, subsequently paid to cafeteria management by the employer, are subject to Ga. L. 1951, p. 360 (see now O.C.G.A. Art 1, Ch. 8, T. 48). Davis v. Chilivis, 142 Ga. App. 679, 237 S.E.2d 2 (1977).

Tangible Personal Property

Fixtures which pass by conveyance of realty are exempt.

- All fixtures which would pass by a conveyance of an interest in realty as a part thereof, in the absence of provisions in the sales contract to the contrary, are exempt from the tax imposed by Ga. L. 1951, p. 360 (see now O.C.G.A. Art. 1, Ch. 8, T. 48). State v. Dyson, 89 Ga. App. 791, 81 S.E.2d 217 (1954).

- Video tape can be seen and is perceptible to the senses and thereby satisfies the definition of tangible property. Turner Communications Corp. v. Chilivis, 239 Ga. 91, 236 S.E.2d 251 (1977).

- Sale of a complete, operating telephone system, including rights-of-way to which other equipment is attached, is not a sale of tangible personal property such as would be subject to sales tax. State v. Dyson, 89 Ga. App. 791, 81 S.E.2d 217 (1954).

- Architectural plan, in its physical form, is obviously tangible, its finite mass lending weight and sensory perception. State Farm Fire & Cas. Ins. Co. v. White, 777 F. Supp. 952 (N.D. Ga. 1991).

- Although modular homes may become realty when those modular homes are affixed to the purchaser's lot, when those modular homes are transferred as partial units on trailers those modular homes are properly considered tangible personal property within the meaning of O.C.G.A. § 48-8-2(11). Adrian Hous. Corp. v. Collins, 253 Ga. 263, 319 S.E.2d 852 (1984).

Use Tax

Purchase outside state of tangible personal property to be transferred incident to service contract.

- If a purchase is made outside the state and a transfer is then made incidental to performing a service within the state, the purchase is subject to a use tax. L.M. Berry & Co. v. Blackmon, 231 Ga. 659, 203 S.E.2d 520 (1974).

Direct mail advertising materials purchased by a corporation outside the state for distribution to residents within the state were subject to use tax. Collins v. J.C. Penney Co., 218 Ga. App. 405, 461 S.E.2d 582 (1995).

Preprinted newspaper advertising inserts purchased by a corporation did not become a component or integral part of the newspaper through which the inserts were distributed and were subject to use tax. Collins v. J.C. Penney Co., 218 Ga. App. 405, 461 S.E.2d 582 (1995).

ANALYSIS

• General Consideration
• Dealer
• Lease or Rental
• Retail Sale
• Sale
• Sales Price
• Tangible Personal Property
• Use Tax

General Consideration

Constitutionality.

- Imposition of use tax upon "cost price," as defined by O.C.G.A. § 48-8-2(2), does not violate the commerce clause (U.S. Const., Art. 1, Sec. 8, Cl. 3) as it treats taxpayers printing own material out-of-state and taxpayers printing own material within the state equally. 1981 Op. Att'y Gen. No. 81-93.

- Purchase by department stores within Georgia of advertising materials from out-of-state printers, shipped by printers to designated in-state direct mailing services, and distributed by such services to the stores' customers in Georgia constitutes "use" in Georgia by the stores within the meaning of O.C.G.A. § 48-8-2(12). 1981 Op. Att'y Gen. No. 81-93.

Dealer

Dual operator liable for tax on property consumed in performance of contract.

- Since a dual operator, or person who, as a retail dealer, sells tangible personal property in performing contracts, is a consumer of the property used in performing contracts, irrespective of where the contracts may be performed, the person would owe sales tax in this state with respect to the purchase of such property in this state and would owe this state a use tax with respect to such property purchased outside this state and then brought to rest in this state. 1968 Op. Att'y Gen. No. 68-96.

- Resident subsidiary does not cause a nonresident mail order subsidiary of the same parent corporation to be subject to Ga. L. 1951, p. 360 (see now O.C.G.A. Art. 1, Ch. 8, T. 48). 1969 Op. Att'y Gen. No. 69-132.

Lease or Rental

Legislative intent as to distinction between services and leases or rentals.

- Analytically, if inquiry be pursued to the limit of its logic, it might be said that every lease or rental involves some element of service, while every service involves some utilization of personal property; but here as in all cases, the law does not deal in absolutes for the General Assembly has, by employing two concepts differing in their consequences, manifested the General Assembly's intention that a line is to be drawn somewhere separating the areas of taxability and nontaxability. 1963-65 Op. Att'y Gen. p. 172.

- Rental charges mean the actual charges made for the leasing of tangible personal property without any deductions on account of the cost of materials used, service cost, or any other expenses, even though separately stated. 1970 Op. Att'y Gen. No. U70-47.

Sales tax is only based upon gross proceeds from rentals and is not to be imposed upon payment of royalties. 1954-56 Op. Att'y Gen. p. 845.

- Use of bank computers by customers for consideration, when customers have complete control over operation for an allotted time, is a lease or rental of computers and is subject to sales and use tax. 1969 Op. Att'y Gen. No. 69-128.

- When the owner of a bulldozer furnishing earth-moving services is at all times in complete control and direction of the machine, such transaction constitutes merely the rendition of personal services and is not a leasing of the property so as to be subject to payment of the state sales tax. 1952-53 Op. Att'y Gen. p. 236.

Rental contracts which are completed fully within this state are subject to Ga. L. 1951, p. 360 (see now O.C.G.A. Art. 1, Ch. 8, T. 48), notwithstanding the fact that physical possession of the rented property is delivered outside this state. 1969 Op. Att'y Gen. No. 69-146.

- Leasing or renting of trucks by lumber companies is subject to payment of the state sales tax, notwithstanding the fact that the goods transported are in interstate commerce, since it cannot be considered the rendering of transportation services, but is, in effect, a lease. 1952-53 Op. Att'y Gen. p. 242.

Property bought for purposes of leasing or renting is bought for resale and the transaction is excluded as a sale subject to sales and use tax. 1960-61 Op. Att'y Gen. p. 551.

Personal service transactions in which no sales are involved are not "retail sales" or "sales at retail." 1952-53 Op. Att'y Gen. p. 236.

- When property is delivered pursuant to sales to out-of-state locations by a means of transportation which is leased or rented by the buyer, the sales occur in this state and are taxable under Ga. L. 1951, p. 360 (see now O.C.G.A. Art. 1, Ch. 8, T. 48). 1969 Op. Att'y Gen. No. 69-146.

- Taxpayer engaged in the business of renting automobiles is exempt from the payment of sales tax upon automobiles, automobile accessories, tires and parts purchased by the taxpayer, since such property is purchased for the purpose of resale. 1952-53 Op. Att'y Gen. p. 482.

Sheriff making a sale of inventory and fixtures under fi. fa. is required to collect sales tax thereon unless the purchaser of such goods intends to resell the property purchased, in which case the purchaser should present a resale certificate. 1952-53 Op. Att'y Gen. p. 241.

Municipal corporation engaged in business of buying and distributing natural gas to customers in municipality is not exempt from paying sales and use tax. 1954-56 Op. Att'y Gen. p. 860.

Meals sold by restaurants and hotels to employees are taxable. 1950-51 Op. Att'y Gen. p. 420.

Admission charges to educational concerts are subject to state sales tax. 1952-53 Op. Att'y Gen. p. 228.

Schools must collect sales tax on admissions to school-sponsored functions. 1954-56 Op. Att'y Gen. p. 868.

State sales tax is imposed upon all sums deposited in pinball and music box machines, and is not limited to the share of receipts due either the owner of the vending machine or the party owning the premises where located. 1952-53 Op. Att'y Gen. p. 483.

- Membership in a theatrical corporation, members of which are entitled to admission to all productions, is tantamount to the purchasing of tickets and is therefore subject to payment of the state sales tax. 1952-53 Op. Att'y Gen. p. 228.

Admission fees charged by carnivals are subject to payment of the state sales tax, including charges for any rides or shows within the carnival. 1952-53 Op. Att'y Gen. p. 228.

Green fees or admission fees to golf courses are subject to sales tax, although no ticket or item of tangible personal property is issued. 1954-56 Op. Att'y Gen. p. 830.

- Whether a county-wide buying club constitutes a retail outlet so as to qualify as a retail food store for the purpose of redeeming federal food stamps is a decision for the United States Secretary of Agriculture to make. 1970 Op. Att'y Gen. No. U70-81.

Sales tax applies to any transfer of title or possession, including that accomplished by barter. 1954-56 Op. Att'y Gen. p. 835.

- When the party contracting for construction enjoys exemption or immunity from sales and use taxes and purchases tangible personal property for the party's own use, the sale and use are exempt from the tax, but when such party purchases tangible personal property for the use of the party's contractor in the performance of the contract, even though the completed construction will be for the benefit of such party, it is not purchasing for the party's own use, and the exemption or immunity, otherwise available, does not apply. 1957 Op. Att'y Gen. p. 322.

Sales tax applies to purchase of machinery by an out-of-state purchaser if title passes in this state, even if the property is immediately removed from the state. 1971 Op. Att'y Gen. No. U71-92.

- Sales of equipment which is delivered by common carriers procured by the seller to the out-of-state residences of the buyers are taxable. 1969 Op. Att'y Gen. No. 69-147.

Sales Price

Transportation costs as element of sales price.

- Transportation costs are properly included in the total amount for which the property is sold as services which are part of the sale. The exemption provided for in Ga. L. 1951, p. 360 (see now O.C.G.A. Art. 1, Ch. 8, T. 48) applies solely to those charges made for transportation services by a carrier, not incident to a sale of goods by the carrier. 1970 Op. Att'y Gen. No. 70-94.

Water is tangible personal property and the sale of water at retail is subject to sales tax, unless specifically exempted. 1963-65 Op. Att'y Gen. p. 294.

Use Tax

Tax on use of machinery belonging to nonresident corporation.

- Use of machinery by a Georgia corporation, which machinery belongs to a nonresident corporation and for which the Georgia corporation pays a royalty, is subject to use tax. 1954-56 Op. Att'y Gen. p. 846.

- Manufacturer who buys advertising materials outside state, ships those materials directly to dealers, at no cost to dealers, with dealers using the materials to promote local sales, is liable for use tax on such materials. 1962 Op. Att'y Gen. p. 556.

RESEARCH REFERENCES

Am. Jur. 2d.

- 67B Am. Jur. 2d, Sales and Use Taxes, §§ 50 et seq., 123.

- 84 C.J.S., Taxation, §§ 159 et seq., 171 et seq.

- What amounts to "sale at retail" within Sales Tax Act, 98 A.L.R. 837; 111 A.L.R. 943; 115 A.L.R. 491; 139 A.L.R. 372; 163 A.L.R. 276, 171 A.L.R. 697.

Deductibility of freight charges in determining amount of gross sales or receipts for purposes of statutes making gross sales or receipts the subject or measure of a tax, 102 A.L.R. 768.

Computation of sales tax, 150 A.L.R. 1311.

Sale of building materials, supplies, or fixtures to contractor, or his use thereof in construction or repairs, as sale at retail within tax statute or ordinance, 163 A.L.R. 276; 171 A.L.R. 697.

Sale of building materials, supplies, or fixtures to contractor, or his use thereof in construction or repair, as sale at retail within tax statute or ordinance, 171 A.L.R. 697.

What transactions constitute a "sale" within operation of sales tax law provision defining a sale as including a transfer of possession, license to use, or words to that effect, 172 A.L.R. 1317.

Federal retail luxury or other excise tax as includable in amount on which state sales or use tax is computed, 43 A.L.R.2d 862.

Sale by wholly owned subsidiary to parent corporation, or vice versa, as within retail sales tax, or similar, statute, 64 A.L.R.2d 769.

Redemption of trading stamps or the like for merchandise as sale at retail within taxing statute, 80 A.L.R.2d 1221.

Sales or use tax: deduction or exemption of discount or premium in computing amount of sales, 90 A.L.R.2d 338.

What constitutes manufacturing and who is a manufacturer under tax laws, 17 A.L.R.3d 7.

Applicability of sales tax to "tips" or service charges added in lieu of tips, 73 A.L.R.3d 1226.

Reusable soft drink bottles as subject to sales or use taxes, 97 A.L.R.3d 1205.

Applicability of sales or use taxes to motion pictures and video tapes, 10 A.L.R.4th 1209.

Cable television equipment or services as subject to sales or use tax, 23 A.L.R.6th 165.