Georgia tax expenditure report for FY 2014

Georgia Tax Expenditure Report for FY2014
Prepared by the Fiscal Research Center of the Andrew Young School of Policy Studies at Georgia State University
December 2012

Funding for this project was provided by the Georgia Department of Audits and Accounts. We would like to thank the Georgia Department of Revenue and the Georgia Office of Insurance and Safety Fire Commissioner for their contributions to the preparation of this report. Lastly, we would like to thank Leslie McGuire and Ed Blaha of the Georgia Department of Audits and Accounts for their comments and recommendations. All estimates presented in this report are the work of the Fiscal Research Center. We are solely responsible for its contents.
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Table of Contents
Summary of State Tax Expenditures .......................................................................................................... 10 1. Personal Income Tax............................................................................................................................. 36
1.1 Federal Exclusions ............................................................................................................................ 38 1.2 Federal Deductions ........................................................................................................................... 48 1.3 Special Federal Conformity Provisions ............................................................................................ 55 1.4 Georgia Exemptions.......................................................................................................................... 58 1.5 Georgia Deductions .......................................................................................................................... 62 1.6 Georgia Credits ................................................................................................................................. 63 2. Corporate Income Tax .......................................................................................................................... 69 2.1 Federal Corporate Exclusions ........................................................................................................... 70 2.2 Federal Corporate Deductions .......................................................................................................... 73 2.3 Special Federal Corporate Conformity Provisions ........................................................................... 77 2.4 Corporate Apportionment ................................................................................................................. 80 2.5 Georgia Deductions .......................................................................................................................... 82 2.6 Georgia Credits ................................................................................................................................. 83 3. Corporate Net Worth Tax ..................................................................................................................... 95 4. Sales and Use Tax ................................................................................................................................. 96 4.5 Sales and Use Tax for Services....................................................................................................... 123 4.7 Vendor Compensation .................................................................................................................... 127 4.9 Casual Sales .................................................................................................................................... 127 5. Insurance Premium Tax ........................................................................................................................ 130 6. Motor Fuel Tax ................................................................................................................................... 133 7. Alcoholic Beverage Tax ..................................................................................................................... 135 8. Cigar and Cigarette Excise Tax .......................................................................................................... 137 9. Financial Institutions Special State Occupation Tax .......................................................................... 138 10. Special Assessment of Forest Land Conservation Use Property ...................................................... 139 11. Title Fee for Motor Vehicles............................................................................................................. 140 Appendix of Tables................................................................................................................................... 141 Table 1: Summary of expired and expiring tax expenditures ............................................................... 141 Table 2: Sales and use tax expenditures by type................................................................................... 143 Tables 3-8: Distributional tables of selected provisions ....................................................................... 149
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Introduction
Tax expenditures are provisions in the tax code that allow for special treatment of a source of income or a certain type of expense. Such treatment usually results in a reduction in tax liability for the taxpayer. In principle, these tax benefits could be provided by direct appropriation, thus these provisions are referred to as "expenditures". They represent tax revenues that would have been otherwise generated if not for this preferential treatment in the tax code.
Like direct government expenditures, tax expenditures are an allocation of government revenue that are intended to achieve a particular policy outcome or generate some activity. The value of a tax expenditure can be thought of as representing the amount of money that would be needed in the budget to provide the same level of financial support in the form of a government grant instead of through the tax code. Tax expenditures are received by businesses and individual taxpayers and are present in all of Georgia's major taxes, including the individual income tax, corporate income tax, and sales tax.
Tax expenditures, also referred to as tax preference items, can take several forms. Many are structured as tax credits and deductions, such as the corporate credit for hiring a new worker or the individual deduction for the mortgage interest paid on a primary residence. Other expenditures are in the form of exclusions of income. For example, at the state level, individuals in Georgia are allowed to exclude Social Security income from the calculation of Georgia taxable income. Lastly, some tax expenditures may be provided in the form of reduced rates for selected items in the tax base, such as the partial sales tax exemption for jet fuel.
Tax Expenditure Report Preparation of a tax expenditure report is required by Title 45, Chapter 12, Article 4 of the Official Code of Georgia. The purpose of the report is to list all tax expenditures and their value. In this way, these items can be tracked over time in a fashion analogous to a budget of direct governmental expenditures.
While direct expenditures for such items as education or transportation are reviewed annually with every budget, it is usually the case that tax expenditures are not subject to such periodic
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review. It is important to monitor the value associated with these provisions as they are a reduction in tax revenue and their presence results in special treatment for some taxpayers relative to others. For example, the state government supports education through direct expenditure programs and through HOPE scholarships but also allows a tax deduction for certain educational expenses borne by the taxpayer or paid by an employer. Both the direct expenditure and the tax expenditure represent an allocation of government resources toward education, but only the direct expenditures are listed in an annual budget and subject to annual review.
Leaving tax expenditures out of the annual budgetary review process creates two types of distortions. First, it under-represents the amount of government resources allocated for a given purpose. Second, it incorrectly represents the distribution of the benefits of the government expenditures. The benefits of tax expenditures are usually targeted to higher income taxpayers compared to those associated with direct expenditure programs, so that their absence leads to the conclusion that government resources are targeted toward less affluent taxpayers. In addition, not all tax expenditure programs have a direct budget counterpart, thus without a tax expenditure report, these provisions and their distributional effects escape notice.
The presence of tax expenditures are not necessarily bad tax policy. However, not recognizing or monitoring the resources allocated through the tax system is not good fiscal policy. In this regard, it is important to note that this tax expenditure report does not provide any information on how effective the provision may be in terms of fulfilling its purpose. For instance, while the value of the Research and Development (R&D) credit may be reported annually in the tax expenditure report, there is no accompanying analysis to determine the extent to which more research activities have been undertaken due to the presence of the special provision.
Identifying Tax Expenditures In most cases, identifying a tax expenditure is straightforward. Tax expenditures are deviations or special exceptions from the generally defined tax base, sometimes referred to as the normal tax base or the reference tax base. However, there may be disagreement as to what constitutes the normal or reference tax base. Even at the federal level, the list of tax expenditure items included by the Administration differs from the list estimated by Congress because each works
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from a different definition of the standard tax base. The appropriate norm against which tax expenditures are defined is somewhat subjective and may, in some cases, be driven by the intent of the policy underlying the legislation. For example, we would not consider the difference between the current top income tax rate of six percent and the tax rate of one percent a tax expenditure.
Tax credits and deductions for certain types of activities, such as the jobs tax credit or the lowincome housing credit, are always classified as tax expenditures. This is also the case for items that are taxed at a reduced rate. In addition, specific exclusions from the tax base are, in most cases, considered tax expenditures. Because the Georgia individual and corporate tax systems are both tied to the federal individual and corporate bases, exclusions or deductions at the federal level apply to the state tax base as well. In some cases, Georgia chooses not to conform to federal provisions, such as the Section 199 deduction for domestic production activities. In these cases, we do not include the provision as a tax expenditure. It is also important to note that tax expenditures are not computed for revenue that is due but not collected.
There are instances when it is unclear whether a given tax provision should be listed as a tax expenditure. This is because it is unclear what constitutes the general rule and therefore, it is sometimes difficult to determine which provisions are exceptions to that rule. Consider the personal income tax exemption. Individuals are allowed to exclude an amount of income for each taxpayer included on the return but this exemption of income is not considered a tax expenditure by all states. Another example is the provision allowing for the use of a singlefactor apportionment formula in allocating income earned by corporations operating in more than one state. On one hand, because the general rule of the single-factor apportionment formula has been established at the state level, only deviations from that rule would be listed as a tax expenditure. Alternatively, if one considers the status-quo method of apportionment to be the equally weighted three-factor apportionment formula, any deviation from that rule, such as the double-weighted three factor or single-factor apportionment formula, would be reported as a tax expenditure. This sort of problematic classification of tax expenditures also applies to the taxation of services under the state sales tax. Because state legislation refers to the purchase of tangible goods, the exclusion of services from the base may not be seen as a deviation from the general rule. On the other hand, if it is really the intent of the general rule to tax all
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consumption, then the exclusions provided to the consumption of services should be listed as a tax expenditure. In this report we attempt to incorporate as comprehensive a definition as possible.
Tax Expenditures vs. Revenue Estimates The estimate associated with a tax expenditure provision does not necessarily represent the revenue that would be gained from the repeal of the enabling legislation. Instead, the cost of the tax expenditure represents the value of the deduction or credit taken via the provision. Although the presence of one provision may interact with the use of another provision, tax expenditures are estimated as independent provisions. For instance, if the federal Research and Experimentation credit were repealed, federal revenues would not increase by the amount of the federal tax expenditure estimate but by a smaller amount. This is because some of the R&D expenditures claimed through the federal Research and Experimentation tax credit would be shifted over to another tax deduction or credit so that the savings to the government would be less than the value of the tax expenditure estimate. In addition, tax expenditure estimates do not incorporate behavioral effects that may occur due to the elimination of a provision. For instance, the tax expenditure estimate associated with the deduction for charitable giving is based on a current level of charitable contributions. If the deduction for charitable contributions were eliminated, the revenue effect presented in the fiscal note would incorporate both the initial value of charitable contributions from the tax expenditure estimate and a timing effect that would result from people speeding up their level of contributions in response to the future loss of the deduction. Thus, tax expenditure estimates can only act as an indication of the revenue effect that would occur if the provision were eliminated or modified.
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Data Sources and Reliability of Estimates To the extent possible, data from the Georgia Department of Revenue (DOR) is used to estimate the expenditures included in this report. Unfortunately, the required information is not always collected or available. When it is not, other data sources, such as information from the U.S. Census Bureau, the U.S. Bureau of Economic Analysis, or the U.S. Bureau of Labor Statistics, are used. Every effort is made to provide reliable, well supported estimates of the provisions. Because of the time lag in processing income tax returns, the most recent data available from the Georgia Department of Revenue is calendar year (CY) 2009. Therefore, even in cases where DOR data is used as the primary data source, the tax expenditures presented in this report are estimates.
Two subjective measures of reliability are provided in this report, the estimate reliability and the data reliability. The reliability of both the estimate and data are categorized into three classes, A, B, and C. Class A estimates and data sources are considered the most reliable. Data sources with a Class A status consist of data from the U.S. statistical agencies or from the Georgia Department of Revenue. Estimates with a Class A status are typically those estimates that are based on Class A data that is particularly applicable to the expenditure provision. For instance, most of the state business tax credit expenditures are listed as Class A estimates. They are based on tax credit data provided by the Georgia Department of Revenue that specifically addresses or measures the tax expenditure provision. On the other hand, most sales tax estimates are given a Class B status. While these provisions may be based on Class A data sources, such as the Economic Census or the Consumer Expenditure Survey from the Bureau of Labor Statistics, the data may only be available at a national level, or the data may refer to more activities than is covered by the tax expenditure provision. In these cases, the data must be adjusted to represent the specific activity associated with the expenditure provision and scaled down to represent the value of the activity within Georgia. Because of these adjustments, the estimate is given a Class B status even though it is based on Class A data. Class C estimates are believed to provide reasonable estimates and are based on the best data available. For some items, no reliable information is available. In these cases, no estimate for the expenditure is provided.
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Class of Estimate/Class of Data
Class A
Class B Class C

Description of Estimate Reliability
Based on data specifically related to the tax expenditure
provision and to Georgia taxpayers
Based on national data which has been modified to represent
Georgia and the specific tax activity covered by the expenditure Represents best available estimate at this time

Examples of Data Sources by Reliability Status
Data from Department of Revenue, Bureau of Labor
Statistics Consumer Expenditure Survey, Bureau of Economic Analysis, U.S.
Census Bureau datasets
Industry surveys and trade magazines, most proprietary
information
Newspaper articles, secondary sources

Local Government Effects
In addition to the state estimates, this report attempts, where possible, to estimate the effects on local government revenues. There are many state exemptions that have local ramifications, such as numerous exemptions from the sales tax base. The local estimates that are provided represent the aggregate value of the exemptions that would accrue to the counties, municipalities, special service districts, including tax allocation and community improvement districts, and school districts.

Consistency with prior estimates
This is the third year in which the tax expenditure report has been produced. The report for FY2013 provided estimates for FY2011-FY2013. The current report presents estimates for FY2012-FY2014. In most cases the estimates between the current and past reports are consistent, with the latest report continuing the same trend in the value of the estimates that was established in earlier reports. On the other hand, there are some cases where the estimate presented in the FY2014 report differs significantly from that presented in the past reports. This usually occurs because new information has become available or because a new forecast of economic activity is relied upon to predict future values. The updated estimates are included in

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the current report and any major inconsistency with prior reports is noted in the discussion relating to the expenditure.
Outline of the Report The report continues with a summary table containing a title of each tax expenditure provision, the tax base it is associated with, the type of expenditure and the estimated value for FY2012, FY2013, and FY2014 for all tax expenditures identified in the report. Provisions assigned a value of "(m)" denote a tax expenditure that is estimated to reduce state revenues by less than $1 million. Provisions assigned a value of "(-m)" denote a tax expenditure that is estimated to increase state revenues by less than $1 million. Provisions assigned a negative value denote a positive tax expenditure that is estimated to increase state revenues.
In addition to an identifying title, each expenditure provision is assigned an expenditure number, the first digit of which corresponds to the different sections of this report, such as 1 for the individual income tax and 5 for the insurance premium tax. The remaining portion of the numeric identifier is used to divide the expenditures into different subcategories such as federal and state expenditures, and deductions and credits. Only in the case of the sales tax exemptions does the expenditure number have any relationship to the state tax code section to which the expenditure item is associated. The numeric identifiers for each provision are consistent across tax expenditure reports and can be used to compare expenditure estimates from one report to the next.
Following the summary tables are detailed sections for each of the specific taxes covered in this report. These detailed sections begin with a brief description of the tax, latest figures on revenue collection and any information on recent modifications to the base. These detailed sections also include additional information for each of the expenditure items such as the statute number, the year in which the expenditure provision was enacted and the year in which it became effective, information on the data and estimate reliability and data source, a more detailed description of the tax expenditure provision, and the value of the expenditure provision. The report concludes with an appendix that includes tables listing recently expired provisions, sales and use tax expenditures by type, and distributional analysis for a selected number of provisions.
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Summary of State Tax Expenditures

$ in Millions

Expenditure Summary
Federal Income Tax Provisions1

Tax

Type of

State FY State FY State FY

Expenditure

2012

2013

2014

1.1.001 1.1.002 1.1.003 1.1.004 1.1.005
1.1.006
1.1.007 1.1.008 1.1.009 1.1.010 1.1.011 1.1.012
1.1.013 1.1.014

Exclusion of employee meals and lodging
Exclusion of housing allowances for ministers
Exclusion of employerprovided child care
Exclusion of employee awards
Exclusion of employer contributions and earnings to pension plans. (Includes Keoghs, defined benefit and defined contribution plans) Exclusion for employer contributions for health care, health insurance premiums and long-term care insurance premiums Exclusion for employer paid accident and disability premiums Exclusion for employer contributions for premiums on group long term life insurance Exclusion for employerpaid transportation benefits and employer-provided transit and vanpool benefits Exclusion for benefits provided through cafeteria plans Exclusion for employer provided adoption assistance2 Exclusion for employer provided education benefits (including education assistance and tuition reduction benefits) Exclusion of miscellaneous fringe benefits
Exclusion of foreign earned income (including housing and salary)

Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax

Exclusion Exclusion Exclusion Exclusion Exclusion
Exclusion
Exclusion Exclusion Exclusion Exclusion Exclusion Exclusion
Exclusion Exclusion

8

8

9

5

5

5

13

10

9

2

2

2

848

994

1,132

831

959

1,073

23

24

25

11

12

13

33

35

36

232

260

286

3

1

(m)

7

7

7

43

44

44

42

43

44

1 These are Internal Revenue Code Provisions (IRC) that has been adopted by Georgia as part of its personal income tax. 2 (m) Refers to a revenue loss of less than $1 million.
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Expenditure 1.1.015 1.1.016
1.1.017 1.1.018
1.1.019
1.1.020
1.1.021 1.1.022 1.1.023 1.1.024 1.1.025 1.1.026 1.1.027

Summary of State Tax Expenditures

$ in Millions

Summary

Tax

Exclusion of certain allowances for federal employees abroad Exclusion of benefits and allowances to armed forces personnel (includes expenditure for military disability benefits) Medical care and Tricare Medical Insurance for military dependents and retirees Exclusion for Veterans' Benefits (includes veteran's disability compensation, pensions, and readjustment benefits) Exclusion of income attributable to the discharge of certain student loan debt and NHSC and certain state educational loan repayments Exclusion of Workers' Compensation benefits (includes disability and survivor benefits and medical benefits, and exclusion of damages on account of personal physical injuries or physical sickness) Exclusion for special benefits for disabled coal miners Exclusion of untaxed Social Security and railroad retirement benefits Exclusion of Medicare benefits
Exclusion of certain foster care payments
Exclusion of cash public assistance benefits
Exclusion of scholarship and fellowship income
Exclusion for earnings of Coverdell education savings accounts and interest on educational savings bonds

Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax

Type of Expenditure
Exclusion Exclusion
Exclusion Exclusion
Exclusion
Exclusion
Exclusion Exclusion Exclusion Exclusion Exclusion Exclusion Exclusion

State FY State FY State FY

2012

2013

2014

14

15

16

81

89

96

39

40

41

48

49

49

(m)

(m)

(m)

69

68

68

(m)

(m)

(m)

175

199

223

360

405

443

2

2

2

37

43

45

14

15

16

1

1

1

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Expenditure 1.1.028
1.1.029 1.1.030 1.1.031 1.1.032 1.1.033 1.1.034 1.1.035 1.1.036 1.1.037 1.1.038
1.1.039 1.1.040 1.1.041 1.1.042
1.1.043 1.2.001

Summary of State Tax Expenditures

$ in Millions

Summary

Tax

Exclusion of earnings of qualified tuition programs (including prepaid tuition programs and savings account programs) Exclusion for certain agricultural cost-sharing payments Exclusion of discharge of indebtedness for certain farmers Exclusion of interest on state and local government private activity bonds Exclusion of capital gains from sale of principle residences Exclusion of capital gains at death
Exclusion of capital gains on gifts
Exemption from imputed interest rules
Exclusion of combat pay
Exclusion of energy conservation subsidies provided by public utilities Exclusion from income attributable to the discharge of principal residence acquisition indebtedness Exclusion of gain for certain small business stock
Exclusion of interest on public purpose State and local government bonds Exclusion of income earned by voluntary employees' beneficiary associations Exclusion of survivor annuities paid to families of public safety officers killed in the line of duty Exclusion of disaster mitigation payments
Accelerated depreciation (MACRS)

Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax

Type of Expenditure
Exclusion
Exclusion Exclusion Exclusion Exclusion Exclusion Exclusion Exclusion Exclusion Exclusion Exclusion
Exclusion Exclusion Exclusion Exclusion
Exclusion Deduction

State FY State FY State FY

2012

2013

2014

4

5

6

(m)

(m)

(m)

(m)

(m)

(m)

(m)

(m)

(m)

163

189

204

167

187

225

37

58

28

3

3

3

18

19

20

(m)

(m)

(m)

5

3

(m)

2

2

3

2

2

2

22

24

26

(m)

(m)

(m)

(m)

(m)

(m)

46

44

42

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Expenditure 1.2.002 1.2.003
1.2.004 1.2.005 1.2.006 1.2.007 1.2.008 1.2.009 1.2.010
1.2.011 1.2.012 1.2.013 1.2.014 1.2.015

Summary of State Tax Expenditures

$ in Millions

Summary

Tax

Deduction for expenditures on energy-efficient commercial building property Deduction of exploration and development costs of nonfuel minerals. (Includes excess of depletion over cost depletion, nonfuel minerals) Amortization of business startup costs
Expensing of research and development costs in lieu of R&D tax credit Expensing of magazine circulation expenditures
Deductions for oil and gas exploration and development costs Special treatment for expenses related to timber production Expensing under IRC section 179 of depreciable business property3 Exceptions for publicly traded partnership with qualified income derived from certain energy-related activities Treatment of income from exploration and mining as qualified income for publicly traded partnerships Various agricultural expense provisions
Community and regional development incentives
Expensing to remove architectural and transportation barriers to the handicapped and elderly Inventory methods and valuation, including last in first out, lower of cost or market, specific identification for homogenous products

Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax

Type of Expenditure
Deduction
Deduction
Deduction Deduction Deduction Deduction Deduction Deduction Deduction
Deduction
Deduction Deduction Deduction
Deduction

State FY State FY State FY

2012

2013

2014

1

1

1

(m)

(m)

(m)

11

10

9

(m)

(m)

(m)

(m)

(m)

(m)

(m)

(m)

(m)

2

2

2

24

14

-6

1

1

1

1

1

1

(m)

(m)

(m)

(m)

(m)

(m)

(m)

(m)

(m)

5

5

5

3 Negative values denote a positive tax expenditure that would result in additional revenue to the state budget.
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Expenditure 1.2.017 1.2.018 1.2.019
1.2.020 1.2.021
1.2.022 1.2.023
1.2.024 1.2.025 1.2.026 1.2.027 1.2.028
1.2.029 1.2.030 1.3.001 1.3.002

Summary of State Tax Expenditures

$ in Millions

Summary

Tax

Health Savings Accounts
Deduction for property taxes on real property
Deduction for nonbusiness state and local government income taxes, sales taxes and property taxes Deduction for mortgage interest on owner-occupied residences Deduction for charitable contributions (includes deductions for health, education, and other than health and education) Deduction for casualty and theft losses
Deduction for overnight expenses for National Guard and Reserve members Deduction for premiums for qualified mortgage insurance Deduction for interest on student loans
Deduction for higher education expenses
Deduction for teacher classroom expenses
Deduction for health insurance premiums and long-term care insurance premiums by the selfemployed Deduction for medical expenses and long term care expenses Deduction for IRAs, includes traditional IRAs and Roth IRAs. Like-kind exchanges
Special rules for magazine, paperback book, and record returns

Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax
Federal Individual Income Tax

Type of Expenditure
Deduction Deduction Deduction
Deduction Deduction
Deduction Deduction
Deduction Deduction Deduction Deduction Deduction
Deduction Deduction Deferral Special Rule

State FY State FY State FY

2012

2013

2014

7

9

11

94

98

123

215

239

295

531

555

604

352

394

416

3

3

3

1

1

1

1

(m)

0

6

5

3

3

1

0

(m)

(m)

(m)

21

25

27

69

84

100

60

80

101

3

4

5

(m)

(m)

(m)

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Summary of State Tax Expenditures

$ in Millions

Expenditure Summary

Tax

1.3.003

5 year carryback for net

Federal

operating losses attributable Individual

to farming

Income Tax

1.3.004

Special rules for mining

Federal

reclamation reserves

Individual

Income Tax

1.3.005

Cash accounting, other than Federal

agriculture

Individual

Income Tax

1.3.006

Deferral of gain on non-

Federal

dealer installment sales

Individual

Income Tax

1.3.007

Completed contract rules

Federal

Individual

Income Tax

1.3.008

Special treatment of

Federal

employee stock ownership Individual

plans (ESOPs)

Income Tax

1.3.009

Income averaging for

Federal

farmers and fishermen

Individual

Income Tax

Georgia Individual Income Tax Provisions

Type of Expenditure Special Rule
Special Rule
Special Rule
Special Rule
Special Rule
Deferral
Special Rule

State FY State FY State FY

2012

2013

2014

1

1

1

(m)

(m)

(m)

8

8

8

2

10

12

(m)

(m)

(m)

3

3

3

(m)

(m)

(m)

1.4.001 1.4.002 1.4.003 1.4.004 1.4.005 1.4.006 1.4.007 1.4.008 1.4.009 1.4.010

Personal Exemption
Retirement Income
Exclusion of Federally Taxable Social Security Benefits Georgia Higher Education Savings Plan Contributions Interest on U.S. Obligations
Certain military income
Organ donation expenses
Aged 65/Blind Deduction
Certain dependent's unearned income Premiums for high deductible health plans

State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax

Exemption Exemption Exemption Exemption Exemption Exemption Exemption Exemption Exemption Exemption

867

937

1,035

603

662

697

129

135

140

3

3

3

7

5

6

Estimate not available at this time

(m)

(m)

(m)

6

6

7

Estimate not available at this time

3

3

7

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Expenditure 1.4.011 1.4.012
1.4.013 1.4.014 1.4.015
1.4.016 1.4.017 1.4.018 1.4.019 1.5.001 1.6.001 1.6.002 1.6.003 1.6.004 1.6.005

Summary of State Tax Expenditures

$ in Millions

Summary

Tax

Salaries and wages reduced from Federal taxable income because of the Federal Jobs Tax Credit Individual retirement account, Keogh, SEP and Sub-S plan withdrawals where tax has been paid to Georgia because of the difference between Georgia and Federal law for tax years 1981 through 1986. Depreciation because of differences in Georgia and Federal law during tax years 1981 through 1986. Income from any fund, program or system which is exempted by federal law or treaty. Certain income in which the Sub-S election is not recognized by Georgia or another state in order to avoid double taxation. Adjustment for certain teachers retired from the Teacher's Retirement System of Georgia Amount claimed by certain employers in food and beverage establishments Adjustment of certain payments to minority subcontractors Adjustments to federal AGI for certain Georgia resident partners Standard Deduction
Rural Physician's Credit
Disabled person's home purchase or retrofit credit
Driver Education Credit
Disaster Assistance Credit
Qualified Caregiving Expense Credit

State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax

Type of Expenditure
Exemption Exemption
Exemption Exemption Exemption
Exemption Exemption Exemption Exemption Deduction
Credit Credit Credit Credit Credit

State FY State FY State FY

2012

2013

2014

Estimate not available at this time

Estimate not available at this time

Estimate not available at this time Estimate not available at this time Estimate not available at this time

Estimate not available at this time

Estimate not available at this time

Estimate not available at this time

Estimate not available at this time

174

176

178

1

1

1

(m)

(m)

(m)

1

1

1

(m)

(m)

(m)

(m)

(m)

(m)

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Expenditure 1.6.006
1.6.007 1.6.008 1.6.009 1.6.010 1.6.012 1.6.013 1.6.014 1.6.015 1.6.016 1.6.017 1.6.018 1.6.019 1.6.020 1.6.021 1.6.022 1.6.023 1.6.024

Summary of State Tax Expenditures

$ in Millions

Summary

Tax

Tax credit for Life Insurance for Georgia National Guard and Air National Guard Child and Dependent Care Credit Adoption of Foster Child Credit Low-Income Credit
Credit for taxes paid to another state Employer's Jobs Tax Credit
Quality Jobs Tax Credit
New Facilities Jobs Credit
New Manufacturing Facilities Property Credit Manufacturer's Investment Tax Credit Optional Investment Tax Credit Port Activity Tax Credit
Alternative Port Activity Tax Credit Film Tax Credit
Research Tax Credit
Seed-Capital Fund Credit
Qualified Health Insurance Expense Credit Teleworking Credit (expired 12/31 2011)

State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax

Type of Expenditure
Credit
Credit Credit Credit Credit Credit Credit Credit Credit Credit Credit Credit Credit Credit Credit Credit Credit Credit

State FY State FY State FY

2012

2013

2014

1

1

1

34

34

35

2

3

4

7

7

7

174

179

185

See 2.6.001 in Corporate Credit Section
See 2.6.002 in Corporate Credit Section
See 2.6.003 in Corporate Credit Section
See 2.6.004 in Corporate Credit Section
See 2.6.005 in Corporate Credit Section
See 2.6.006 in Corporate Credit Section
See 2.6.007 in Corporate Credit Section
See 2.6.008 in Corporate Credit Section
See 2.6.009 in Corporate Credit Section
See 2.6.010 in Corporate Credit Section
See 2.6.011 in Corporate Credit Section
See 2.6.012 in Corporate Credit Section
See 2.6.013 in Corporate Credit Section

17 | P a g e

Expenditure 1.6.025 1.6.026 1.6.027
1.6.028 1.6.029 1.6.030 1.6.031 1.6.032 1.6.033 1.6.034 1.6.035 1.6.036 1.6.037 1.6.038 1.6.039
1.6.040

Summary of State Tax Expenditures

$ in Millions

Summary

Tax

Qualified Transportation Credit
Business Enterprise Vehicle Credit
Employer's credit for providing or sponsoring child care for employees and employer's credit for purchasing child care property Low Income Housing Credit
Historic Rehabilitation Credit
Diesel Particulate Emission Reduction Technology Equipment Credit Low/Zero Emission Vehicle Credit & Electric Vehicle Charger Credit Land Conservation Credit
Clean Energy Property and Wood Residuals Credit
Employer's Credit for Basic Skills Education
Employer's Credit for Approved Employee Retraining Qualified Education Expense Credit
Qualified Investor Tax Credit
Energy or water efficient equipment credit
Tax credit for water conservation facilities and qualified water conservation investment property Tax credit for shift from ground water usage

State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax
State Individual Income Tax

Type of Expenditure
Credit Credit Credit
Credit Credit Credit Credit Credit Credit Credit Credit Credit Credit Credit Credit
Credit

State FY State FY State FY

2012

2013

2014

See 2.6.014 in Corporate Credit

Section

See 2.6.015 in Corporate Credit Section

See 2.6.016 in Corporate Credit Section

See 2.6.017 in Corporate Credit Section
See 2.6.018 in Corporate Credit Section
See 2.6.019 in Corporate Credit Section
See 2.6.020 in Corporate Credit Section
See 2.6.021 in Corporate Credit Section
See 2.6.022 in Corporate Credit Section
See 2.6.023 in Corporate Credit Section
See 2.6.024 in Corporate Credit Section
See 2.6.025 in Corporate Credit Section
See 2.6.026 in Corporate Credit Section
See 2.6.027 in Corporate Credit Section
See 2.6.028 in Corporate Credit Section
See 2.6.029 in Corporate Credit Section

18 | P a g e

Summary of State Tax Expenditures

$ in Millions

Expenditure Summary

Tax

1.6.041

Tax credit for existing

State

business enterprises

Individual

undergoing qualified

Income Tax

business expansion

Federal Corporate Income Tax Provisions4

Type of Expenditure
Credit

State FY State FY State FY

2012

2013

2014

See 2.6.030 in Corporate Credit

Section

2.1.001 2.1.002 2.1.003 2.1.004 2.1.005 2.1.006 2.1.007
2.1.008 2.1.009 2.1.010
2.2.001 2.2.002 2.2.003

Exemption from imputed interest rules
Exclusion of interest on state and local government private activity bonds Exclusion of contributions in aid of construction for water and sewer utilities Exclusion of earnings of certain environmental settlement funds Exclusion for certain agricultural cost-sharing payments Exclusion of gain or loss on sale or exchange for brownfield property Exclusion of health insurance benefits for military retirees and retiree dependents enrolled in Medicare Exclusion of disaster mitigation payments
Exclusion of interest on public purpose state and local government bonds Various foreign provisions (Including inventory property sales source rule exception, interest expense allocation, deferral of active income of controlled foreign corporations, deferral of active financing income) Accelerated depreciation (MACRS)
Deduction for expenditures on energy-efficient commercial building property Deduction of exploration and development costs of nonfuel minerals

Federal Corporate Income Tax
Federal Corporate Income Tax
Federal Corporate Income Tax
Federal Corporate Income Tax
Federal Corporate Income Tax
Federal Corporate Income Tax
Federal Corporate Income Tax
Federal Corporate Income Tax
Federal Corporate Income Tax
Federal Corporate Income Tax
Federal Corporate Income Tax
Federal Corporate Income Tax
Federal Corporate Income Tax

Exclusion Exclusion Exclusion Exclusion Exclusion Exclusion Exclusion
Exclusion Exclusion Exclusion
Deduction Deduction Deduction

(m)

(m)

(m)

(m)

(m)

(m)

(m)

(m)

(m)

(m)

(m)

(m)

(m)

(m)

(m)

(m)

(m)

(m)

1

1

(m)

(m)

(m)

(m)

(m)

(m)

(m)

63

58

57

29

30

31

(m)

(m)

(m)

(m)

(m)

(m)

4 These are IRC provisions that have been adopted by Georgia as part of its corporate income tax.

19 | P a g e

Expenditure 2.2.004 2.2.005 2.2.006 2.2.007 2.2.008 2.2.009
2.2.011 2.2.012 2.2.013
2.2.014 2.2.015 2.2.016
2.2.017 2.3.001 2.3.002 2.3.003

Summary of State Tax Expenditures

$ in Millions

Summary

Tax

Amortization of business startup costs
Expensing of research and development costs in lieu of R&D tax credit Expensing of magazine circulation expenditures
Deductions for oil and gas exploration and development costs Special treatment for expenses related to timber production Deduction for charitable contributions (includes deductions for health, education, and other than health and education) Expensing under IRC section 179 of depreciable business property5 Amortization of air pollution control facilities
Election to expense 50 percent of qualified property used to refine liquid fuels Various agricultural expensing provisions
Community and regional development incentives
Expensing to remove architectural and transportation barriers to the handicapped and elderly Inventory methods and valuation
Like-kind exchanges
Special rules for magazine, paperback book, and record returns 5 year carryback for net operating losses attributable to farming

Federal Corporate Income Tax
Federal Corporate Income Tax
Federal Corporate Income Tax
Federal Corporate Income Tax
Federal Corporate Income Tax
Federal Corporate Income Tax
Federal Corporate Income Tax
Federal Corporate Income Tax
Federal Corporate Income Tax
Federal Corporate Income Tax
Federal Corporate Income Tax
Federal Corporate Income Tax
Federal Corporate Income Tax
Federal Corporate Income Tax
Federal Corporate Income Tax
Federal Corporate Income Tax

Type of Expenditure
Deduction Deduction Deduction Deduction Deduction Deduction
Deduction Deduction Deduction
Deduction Deduction Exemption
Deduction Deferral Special Rule Special Rule

State FY State FY State FY

2012

2013

2014

(m)

(m)

(m)

5

6

7

(m)

(m)

(m)

(m)

(m)

(m)

3

3

3

12

12

12

2

(m)

(-m)

1

1

1

(m)

(m)

(m)

(m)

(m)

(m)

(m)

(m)

(m)

(m)

(m)

(m)

14

15

15

4

4

5

(m)

(m)

(m)

(m)

(m)

(m)

5 (-m) Refers to a positive tax expenditure that would result in additional revenue to the state budget of less than $1 million.
20 | P a g e

Summary of State Tax Expenditures

$ in Millions

Expenditure Summary

Tax

2.3.004

Special rules for mining

Federal

reclamation reserves

Corporate

Income Tax

2.3.005

Cash accounting, other than Federal

agriculture

Corporate

Income Tax

2.3.006

Deferral of gain on non-

Federal

dealer installment sales

Corporate

Income Tax

2.3.007

Completed contract rules

Federal

Corporate

Income Tax

2.3.008

Special treatment of

Federal

employee stock ownership Corporate

plans (ESOPs)

Income Tax

2.3.009

Deferral of capital

Federal

construction costs of

Corporate

shipping companies

Income Tax

Georgia Corporate Income Tax Provisions

Type of Expenditure Special Rule
Special Rule
Special Rule
Special Rule
Deferral
Deferral

State FY State FY State FY

2012

2013

2014

(m)

(m)

(m)

(m)

(m)

(m)

11

15

15

2

3

3

-1

-1

-1

(m)

(m)

(m)

2.4.001 2.4.002 2.4.003 2.5.001 2.5.002
2.6.001 2.6.002 2.6.003 2.6.004 2.6.005 2.6.006 2.6.007 2.6.008 2.6.009 2.6.010 2.6.011 2.6.012

Single Factor Apportionment Throwback Rule
Corporate Receipts Sourcing Interest on obligations of United States Exception to intangible expenses and related interest cost Employer's Job Tax Credit
Quality Jobs Tax Credit
New Facilities Jobs Credit
New Manufacturing Facilities Property Credit Manufacturer's Investment Tax Credit Optional Investment Tax Credit Port Activity Tax Credit
Alternative Port Activity Tax Credit Film Tax Credit
Research Tax Credit
Seed-Capital Fund Credit
Qualified Health Insurance Expense Credit

Corporate Income Tax Corporate Income Tax Corporate Income Tax Corporate Income Tax Corporate Income Tax
Corporate Income Tax Corporate Income Tax Corporate Income Tax Corporate Income Tax Corporate Income Tax Corporate Income Tax Corporate Income Tax Corporate Income Tax Corporate Income Tax Corporate Income Tax Corporate Income Tax Corporate Income Tax

Apportionment Apportionment Apportionment
Deduction Deduction
Credit Credit Credit Credit Credit Credit Credit Credit Credit Credit Credit Credit

Estimate not available at this time See page 80
Estimate not available at this time Estimate not available at this time Estimate not available at this time

39

44

48

3

4

5

Included in 2.6.001

Estimate not available at this time

7

8

9

1

1

1

7

7

7

Included in 2.6.007

65

75

86

8

10

13

(m)

(m)

(m)

(m)

(m)

(m)

21 | P a g e

Summary of State Tax Expenditures

$ in Millions

Expenditure Summary

Tax

2.6.013 2.6.014 2.6.015 2.6.016
2.6.017 2.6.018 2.6.019 2.6.020 2.6.021

Teleworking Credit (expired 12/31/2011) Qualified Transportation Credit Business Enterprise Vehicle Credit Employer's Credit for providing or sponsoring child care for employees and employer's credit for purchasing child care property Low Income Housing Credit Historic Rehabilitation Credit Diesel Particulate Emission Reduction Technology Equipment Credit Zero and Low Emission Vehicle Credit; Electric Vehicle Charger Credit Land Conservation Credit

2.6.022

Clean Energy Property &

Wood Residuals Credit

2.6.023

Employer's Credit for

Basic Skills Education

2.6.024

Employer's Credit for

Approved Employee

Retraining

2.6.025

Qualified Education

Expense Credit

2.6.026

Qualified Investor's Tax

Credit

2.6.027

Energy or Water Efficient

Equipment Credit

2.6.028

Tax credit for water

conservation facilities and

qualified water

conservation investment

property

2.6.029

Tax credit for shift from

ground-water usage

2.6.030

Tax credit for existing

business enterprises

undergoing qualified

business expansion

Net Worth Tax

Corporate Income Tax Corporate Income Tax Corporate Income Tax Corporate Income Tax
Corporate Income Tax Corporate Income Tax Corporate Income Tax
Corporate Income Tax
Corporate Income Tax Corporate Income Tax Corporate Income Tax Corporate Income Tax
Corporate Income Tax Corporate Income Tax Corporate Income Tax Corporate Income Tax
Corporate Income Tax Corporate Income Tax

Type of Expenditure
Credit Credit Credit Credit
Credit Credit Credit
Credit
Credit Credit Credit Credit
Credit Credit Credit Credit
Credit Credit

State FY State FY State FY

2012

2013

2014

1

0

0

(m)

(m)

(m)

(m)

(m)

(m)

8

9

10

33

36

39

(m)

(m)

(m)

(m)

(m)

(m)

3

4

4

19

30

34

2

3

3

(m)

(m)

(m)

19

25

29

51

52

53

0

0

7

0

0

0

Estimate not available at this time

Estimate not available at this time Included in 2.6.001

3.001 3.002

Exemption for nonprofit corporations Exemptions from the Net Worth Tax

Net Worth Tax
Net Worth Tax

Exemption Exemption

Estimate not available at this time Estimate not available at this time

22 | P a g e

Summary of State Tax Expenditures

$ in Millions

Expenditure Summary
Sales and Use Tax

Tax

Type of

State FY State FY State FY

Expenditure

2012

2013

2014

4.00100
4.00200
4.00300 4.00400 4.00500 4.00600 4.00610 4.00620
4.00630 4.00700

Sales to Federal Government, State of Georgia or a county or municipality in Georgia or any agency of such governments Tangible personal property furnished by the Federal Government or any county or municipality used by a contractor in the installation, repair, or extension of any public water, gas, or sewer system. Federal retailer's excise tax if separately itemized to the consumer and Georgia motor fuel tax imposed on the sale of motor fuel Sales of transportation furnished by a county or municipal public transit system or public transit authorities Sales of transportation furnished by an approved and authorized urban transit system Sales to any Hospital Authority created by Georgia law Sales to any Housing Authority created by Georgia law Sales to local government authorities created on or after January 1, 1980 for the principal purpose of constructing, owning, or operating a coliseum and related facilities Sales to any agricultural commission created by the Department of Agriculture Sales of tangible personal property and services to an approved nursing home, inpatient hospice, general hospital or mental hospital when used specifically in the treatment function.

Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax Sales and Use Tax Sales and Use Tax
Sales and Use Tax Sales and Use Tax

Exemption
Exemption
Exemption Exemption Exemption Exemption Exemption Exemption
Exemption Exemption

Estimate not available at this time Estimate not available at this time

4

4

4

6

6

6

Included in 4.00400

Included in 4.00700

2

2

2

(m)

(m)

(m)

(m)

(m)

(m)

82

85

87

23 | P a g e

Expenditure 4.00710
4.00720 4.00800 4.00900
4.01000
4.01100
4.01200 4.01300 4.01400 4.01500 4.01510

Summary of State Tax Expenditures

$ in Millions

Summary
Sales of tangible personal property and services to a nonprofit organization whose primary function is to provide services to persons with intellectual disabilities. Sales to Georgia Society of the Daughters of the American Revolution Sales of tangible personal property and services to the University System of Georgia and its educational units. Sales of tangible personal property and services used exclusively in the educational function of an approved private college or university located in Georgia whose credits are accepted by the University System of Georgia. Sales of tangible personal property and services used exclusively in the educational function of an approved private elementary or secondary school Sales of tangible personal property or services to, and the purchase of tangible personal property or services by, any educational or cultural institute School lunches sold and served to pupils and employees of public schools School lunches sold and served to pupils and employees of approved private schools Sales of art and other artifacts for display or exhibition to museums Specific fundraising sales by any religious institution lasting no more than 30 days in a calendar year. Sales of pipe organs or steeple bells to any church qualifying as a nonprofit

Tax Sales and Use Tax
Sales and Use Tax Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax Sales and Use Tax
Sales and Use Tax

Type of Expenditure
Exemption

State FY State FY State FY

2012

2013

2014

2

2

2

Exemption

(m)

(m)

(m)

Exemption

29

30

31

Exemption

Estimate not available at this time

Exemption

2

2

2

Exemption

Estimate not available at this time

Exemption

8

8

8

Exemption

(m)

(m)

(m)

Exemption

(m)

(m)

(m)

Exemption

(m)

(m)

(m)

Exemption

(m)

(m)

(m)

24 | P a g e

Expenditure 4.01600
4.01700 4.01800 4.01900
4.02000 4.02100
4.02200
4.02300 4.02400 4.02500

Summary of State Tax Expenditures

$ in Millions

Summary
The sale or use of Holy Bibles; testaments, and similar books commonly recognized as being Holy Scripture regardless of by or to whom sold Sales of fuel or consumable supplies used by ships engaged in inter-coastal or foreign commerce Charges for transportation of tangible personal property made in connection with interstate or intrastate transportation All tangible personal property purchased outside this state by a nonresident when the property is brought into Georgia upon the nonresident becoming a resident Water delivered through water mains, lines, or pipes. Sales, transfers or exchanges of tangible personal property resulting from business reorganization when the owners, partners, or stockholders maintain the same proportionate interest or share in the newly formed business Professional, insurance or personal service transactions which involve sales as inconsequential elements for which no separate charge is made Repair services when a separate charge is made to the customer Rental of videotape or film to persons charging admission to view the tape or film Sale of seed, fertilizer, fungicide, and certain other agricultural chemicals to farmers, and feed for livestock, fish, or poultry purchased by persons engaged in animal husbandry (expires January 1, 2013)

Tax Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax Sales and Use Tax
Sales and Use Tax
Sales and Use Tax Sales and Use Tax
Sales and Use Tax

Type of Expenditure
Exemption

State FY State FY State FY

2012

2013

2014

Estimate not available at this time

Exemption Exemption

23

23

23

Estimate not available at this time

Exemption

Estimate not available at this time

Exemption Exemption

See expenditure estimate for Residential Utilities (4.5009) Estimate not available at this time

Exemption

See expenditure estimates for services (4.50003, 4.50010, 4.50011)

Exemption Exemption

See expenditure estimates for Services (4.50003, 4.50010, 4.50011)
Estimate not available at this time

Exemption

150

80

0

25 | P a g e

Expenditure 4.02600
4.02700 4.02800 4.02900 4.02910
4.03000
4.03100 4.03200
4.03300 4.03310 4.03400

Summary of State Tax Expenditures

$ in Millions

Summary
Sale of machinery used exclusively for irrigation of crops to persons primarily engaged in producing farm crops for sale (expires January 1, 2013) Sales of sugar for use as food to honey bee producers (expires January 1, 2013) Sale of cattle, hogs, sheep, horses, poultry, or bees when sold for breeding purposes (expires January 1, 2013) Sale of certain types of agricultural machinery (expires January 1, 2013) Off-road equipment and related attachments used exclusively in site preparation, planting, cultivating, or harvesting of timber by persons primarily engaged in growing or harvesting timber (expires January 1, 2013) Vehicles purchased by service-connected disabled veterans when the U.S. Dept. of Veterans Affairs supplies a grant to purchase the specially adapted vehicle Sale of tangible personal property manufactured or assembled in Georgia for export when delivery is taken outside of Georgia Aircraft, watercraft, motor vehicles, and other transportation equipment manufactured or assembled in this State for exclusive use outside Georgia Common or Common and Contract Carriers Partial sales tax exemption for jet fuel sold to or used by a qualifying airline at a qualifying airport Certain machinery used in the manufacturing of tangible personal property (expires January 1, 2013)

Tax Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax Sales and Use Tax
Sales and Use Tax

Type of Expenditure
Exemption

State FY State FY State FY

2012

2013

2014

1

(m)

0

Exemption

(m)

(m)

0

Exemption

2

1

0

Exemption

33

17

0

Exemption

12

6

0

Exemption

(m)

(m)

(m)

Exemption

Estimate not available at this time

Exemption

Estimate not available at this time

Exemption Exemption
Exemption

Estimate not available at this time

20

21

22

175

90

0

26 | P a g e

Expenditure 4.03410 4.03420 4.03430 4.03440
4.03500 4.03600 4.03610 4.03700
4.03800 4.03900

Summary of State Tax Expenditures

$ in Millions

Summary
Machinery and equipment used to handle, move, or store tangible personal property in certain distribution facilities Machinery and equipment used directly to remanufacture certain aircraft engines or aircraft engine parts The sale or use of repair or replacement parts, machinery clothing, molds, dies, waxes or tooling for machinery (expires January 1, 2013) Sales of tangible personal property to or used in or for the construction of a new alternative fuel facility primarily dedicated to the production and processing of ethanol, biodiesel, butanol or their by-products (expired 6/30/2012) Certain materials used in industrial packaging (expires January 1, 2013) Machinery and equipment used in a facility for the primary purpose of reducing or eliminating air and water pollution Machinery and equipment used for water conservation and incorporated into a qualified water conservation facility. Machinery and equipment used in combating air and water pollution and any industrial material used in a burning or recycling process (expiring January 1, 2013) Sale of tangible personal property and fees and charges for services by the Rock Eagle 4-H center Certain sales by a public or private school of tangible personal property, concessions, and tickets for admission to school functions

Tax Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax Sales and Use Tax

Type of Expenditure
Exemption

State FY State FY State FY

2012

2013

2014

3

3

3

Exemption

(m)

(m)

(m)

Exemption

Estimate not available at this time

Exemption

2

0

0

Exemption Exemption

Estimate not available at this time Estimate not available at this time

Exemption

Estimate not available at this time

Exemption

Estimate not available at this time

Exemption

(m)

(m)

(m)

Exemption

3

3

3

27 | P a g e

Expenditure 4.03910
4.04000 4.04100 4.04200
4.04300 4.04400
4.04500 4.04600 4.04700
4.04800 4.04900

Summary of State Tax Expenditures

$ in Millions

Summary
Cargo containers and related chassis used for storage or shipping by persons engaged in international shipment of tangible personal property Sale of major components or repair parts installed in military aircraft, vehicles, or missiles Sale of tangible personal property and services to a nonprofit child-caring institute, child-placing agency, or maternity home Use or lease of tangible personal property when the lessor and lessee are under 100 percent common ownership and where the person who furnishes, leases, or rents the property has paid sales or use tax on the property Revenues from coinoperated amusement machines for which individual permits are required Sales of motor vehicles to nonresident purchasers when vehicles are immediately removed from Georgia and titled in another state. The sale or use of paper stock when used to print catalogs for distribution outside Georgia. Sales of tangible personal property or taxable services to nonprofit blood banks Sales of drugs dispensed by prescription, prescription glasses, contact lenses, contact lens samples and sales or use of certain controlled substances or dangerous drugs Sales of crab bait to licensed commercial fishermen Liquefied gases and other fuels used in poultry or pullet houses or structures (expires January 1, 2013)

Tax Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax Sales and Use Tax
Sales and Use Tax Sales and Use Tax

Type of Expenditure
Exemption

State FY State FY State FY

2012

2013

2014

Estimate not available at this time

Exemption

44

40

34

Exemption

1

1

1

Exemption

Estimate not available at this time

Exemption

2

2

2

Exemption

Estimate not available at this time

Exemption

Estimate not available at this time

Exemption Exemption

(m)

(m)

(m)

388

405

423

Exemption

(m)

(m)

(m)

Exemption

3

2

0

28 | P a g e

Expenditure 4.05000
4.05100 4.05200 4.05300 4.05400 4.05500 4.05600 4.05700 4.05900
4.06000
4.06100 4.06200
4.06300

Summary of State Tax Expenditures

$ in Millions

Summary
Sales of blood measuring devices, monitoring equipment, or insulin delivery systems used exclusively by diabetics; insulin, insulin syringes and blood glucose monitoring strips Sales of oxygen when prescribed by a licensed physician Sale or use of hearing aids
Transactions where food stamps or WIC coupons are used as the method of payment Sale or use of any durable medical equipment or prosthetic device prescribed by a physician Sale of Georgia lottery tickets Sales by any qualified nonprofit parent teacher organization Food purchased for off premises consumption Sales of eligible food and beverages for on or offpremises consumption by any Girl or Boy Scout council Sales of certain machinery and equipment used to improve air quality in a clean room of Class 100,000 or less Advertising inserts that are used in newspapers for resale Sod grass sold in the original state of production by the sod producer, employee of the producer, or family member of the producer Funeral merchandise when paid with funds from the Georgia Crime Victims' Emergency fund

Tax Sales and Use Tax
Sales and Use Tax Sales and Use Tax Sales and Use Tax
Sales and Use Tax
Sales and Use Tax Sales and Use Tax Sales and Use Tax Sales and Use Tax
Sales and Use Tax
Sales and Use Tax Sales and Use Tax
Sales and Use Tax

Type of Expenditure
Exemption

State FY State FY State FY

2012

2013

2014

19

20

22

Exemption Exemption Exemption
Exemption
Exemption Exemption Exemption Exemption

5

5

5

4

4

4

123

117

111

Included in 4.04700

160

165

171

(m)

(m)

(m)

432

472

509

1

1

1

Exemption

Estimate not available at this time

Exemption Exemption

Estimate not available at this time

4

4

4

Exemption

(m)

(m)

(m)

29 | P a g e

Expenditure 4.06400
4.06500
4.06600 4.06700 4.06800
4.06900
4.07000 4.07100
4.07200 4.07300
4.07500 4.07700

Summary of State Tax Expenditures

$ in Millions

Summary
Sales of electricity or fuels used exclusively for the operation of an irrigation system on a farm for crop irrigation (expires January 1, 2013) Sales of dyed diesel fuel used exclusively for operations of vessels or boats by licensed commercial fishermen Sales of gold, silver, or platinum bullion Sales of coins or currency
Sales of certain computer equipment when the total qualifying purchases by a high technology company exceed $15 million Sales of machinery and equipment and material incorporated and used in a clean room of Class 100 or less Sales of natural gas used directly in the manufacture of electricity Sales to or by an organization whose primary purpose is to raise funds for books, materials, and programs for public libraries Sales of wheelchairs and attachments for wheelchairs when sold to permanently disabled individuals Sales of certain production equipment to film producers and film production companies (expires January 1, 2013) Sales tax holiday for back to school items (expires August 10, 2013) Liquefied gases and other fuels used in structures where plants, floral products, seedlings, and nursery stock are grown for sale (expires January 1, 2013)

Tax Sales and Use Tax
Sales and Use Tax
Sales and Use Tax Sales and Use Tax Sales and Use Tax
Sales and Use Tax
Sales and Use Tax Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax Sales and Use Tax

Type of Expenditure
Exemption

State FY State FY State FY

2012

2013

2014

20

15

0

Exemption

(m)

(m)

(m)

Exemption Exemption Exemption

Estimate not available at this time Estimate not available at this time Estimate not available at this time

Exemption

Estimate not available at this time

Exemption

37

36

36

Exemption

(m)

(m)

(m)

Exemption Exemption

Included in 4.04700

10

5

0

Exemption Exemption

0

39

41

1

(m)

0

30 | P a g e

Expenditure 4.07800
4.07900 4.08100 4.08200 4.08300 4.08600
4.08800 4.09000 4.09100 4.09200

Summary of State Tax Expenditures

$ in Millions

Summary
Materials used to construct a new symphony hall costing in excess of $200 million that is owned and operated by a nonprofit organization (expired 9/1/2011) Ice used to chill poultry or vegetables during processing or shipment (expires January 1, 2013) The purchase of food and nonalcoholic beverages provided at no charge aboard a qualified airline Sales tax holiday for water and energy efficient purchases (expires October 6, 2013) Sale of biomass materials used to produce electricity or steam or used to produce electricity and steam intended for sale Sales of engines, parts, equipment and other tangible personal property used in the maintenance or repair of certain aircraft (expires 6/30/2013) Sales of tangible personal property used in the construction of a qualified civil rights museum (expires 7/30/2015) The sale of electricity to a manufacturer located in this state used directly in the manufacture of a product (expires January 1, 2013) The sale of prewritten software which has been delivered to the purchaser electronically or by means of load and leave. Sales to an organization defined by the Internal Revenue Service as an instrumentality of the states relating to the holding of an annual meeting in this state for the period commencing July 1, 2012, and ending on December 31, 2013.

Tax Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax

Type of Expenditure
Exemption

State FY State FY State FY

2012

2013

2014

0

0

0

Exemption Exemption Exemption Exemption

Estimate not available at this time

5

4

4

0

(m)

(m)

(m)

(m)

(m)

Exemption

7

7

0

Exemption

(m)

(m)

(m)

Exemption

Estimate not available at this time

Exemption

Estimate not available at this time

Exemption

Estimate not available at this time

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Expenditure 4.09300
4.09400
4.3.20000
4.3.30000
4.50000 4.50001 4.50002 4.50003 4.50004 4.50005 4.50006 4.50007 4.50008 4.50009

Summary of State Tax Expenditures

$ in Millions

Summary

Tax

Sales of tangible personal property used for and in the construction of a competitive project of regional significance, for the period commencing January 1, 2012, until June 30, 2014. The sale, use, consumption, or storage of materials, containers, labels, sacks, or bags used for packaging tangible personal property for shipment or sale. Exemptions for energy, machinery or equipment, industrial material, and consumable supplies used in manufacturing Sales and use by a qualified agriculture producer of agricultural production inputs, energy used in agriculture, and agricultural machinery and equipment Admissions and Amusements
Agricultural Services
Automotive Services
Business Services
Computer and Online Services
Construction Labor
Fabrication, Installation, and Repair Services
Finance, Insurance, and Real Estate
Industrial and Mining Services
Residential Utility Service

Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax for
Services Sales and Use Tax for Services Sales and Use Tax for Services Sales and Use Tax for Services Sales and Use Tax for Services Sales and Use Tax for Services Sales and Use Tax for Services Sales and Use Tax for Services Sales and Use Tax for Services Sales and Use Tax for Services

Type of Expenditure
Exemption
Exemption
Exemption
Exemption
Exemption Exemption Exemption Exemption Exemption Exemption Exemption Exemption Exemption Exemption

State FY State FY State FY

2012

2013

2014

Estimate not available at this time

Estimate not available at this time

Estimate not available at this time Estimate not available at this time

102 106 83 493 202 1,542 167 355
7 106

104 109 85 506 207 1,584 171 364
7 108

109 114 89 530 217 1,660 179 382
7 113

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Summary of State Tax Expenditures

$ in Millions

Expenditure Summary

Tax

4.50010

Personal Services

4.50011

Professional Services

4.50012

Storage

4.50013

Transportation Services

4.70000

Compensation of dealers

for reporting and paying tax

4.90000

Sales tax exemption for

casual sales

Insurance Premium Tax

Sales and Use Tax for
Services Sales and Use Tax for Services Sales and Use Tax for Services Sales and Use Tax for Services Sales and Use Tax Sales and Use Tax

Type of Expenditure
Exemption
Exemption
Exemption
Exemption
Exemption Exemption

State FY State FY State FY

2012

2013

2014

153

157

165

1,218

1,251

1,311

46

48

50

(m)

(m)

(m)

53

56

58

151

125

2

5.00100

Deduction of retaliatory

Insurance

Deduction

2

2

2

taxes paid to other states

Premium

Tax

5.00200

Insurance premium tax

Insurance

Credit

77

79

81

credits

Premium

Tax

5.00300

Exemption for premiums of Insurance

Exemption

1

1

1

high deductible health plans Premium

Tax

5.00400

Exemption for insurance

Insurance

Exemption

(m)

(m)

(m)

companies that only insure Premium

places of worship

Tax

5.00500

Insurance abatements

Insurance

Rate Reduction

133

137

141

Premium

Tax

5.00600

Special deductions for life

Insurance

Deduction

114

118

120

insurance companies

Premium

Tax

Motor Fuel Tax

6.00100

Motor fuel tax refunds for

agricultural purposes

6.00200

Sales to mass transit

vehicles

6.00300

Sales to campus

transportation vehicles

6.00400

Motor fuel tax exemption

for aviation fuel

6.00500

Motor fuel tax vendor

compensation

Alcoholic Beverage Tax

Motor Fuel Tax
Motor Fuel Tax
Motor Fuel Tax
Motor Fuel Tax
Motor Fuel Tax

Exemption Exemption Exemption Exemption Exemption

20

20

20

3

3

3

Included in 6.00200

(m)

(m)

(m)

5

5

5

7.00100 7.00200

Sales to persons outside the state for resale or consumption outside the state Sales to stores or canteens in U.S. military reservations

Alcoholic Beverage
Tax
Alcoholic Beverage
Tax

Exemption Exemption

Estimate not available at this time Estimate not available at this time

33 | P a g e

Summary of State Tax Expenditures

$ in Millions

Expenditure Summary

7.00300 7.00400 7.00500

Up to 200 gallons annually of home-brew per household Sales to and use by religious organizations for sacramental purposes Exemption for ethyl alcohol used for certain purposes

7.00600

Malt beverages containing

less than one-half of 1

percent alcohol by volume

Cigar and Cigarette Tax

Tax
Alcoholic Beverage
Tax Alcoholic Beverage
Tax Alcoholic Beverage
Tax Alcoholic Beverage
Tax

Type of Expenditure
Exemption

State FY State FY State FY

2012

2013

2014

(m)

(m)

(m)

Exemption

(m)

(m)

(m)

Exemption

(m)

(m)

(m)

Exemption

(m)

(m)

(m)

8.00100

Exemption for purchases

Cigar and

for use exclusively by

Cigarette

patients at the Georgia War Excise Tax

Veterans Home and the

Georgia War Veterans

Nursing Home

8.00200

Di minimus amount

Cigar and

brought into the state by

Cigarette

one person

Excise Tax

8.00300

Cigars and cigarettes stored Cigar and

in a public warehouse

Cigarette

Excise Tax

8.00400

Certain cigars and

Cigar and

cigarettes held by licensed

Cigarette

dealers

Excise Tax

Financial Institutions Business License Tax

Exemption
Exemption Exemption Exemption

(m)

(m)

(m)

Estimate not available at this time Estimate not available at this time Estimate not available at this time

9.00100

Deduction for interest paid Financial

Institutions

Business

License Tax

9.00200

Deductions for income

Financial

from authorized activities Institutions

of a domestic international

Business

banking facility

License Tax

9.00300

Deduction for income from Financial

banking business with

Institutions

persons or entities outside

Business

the U.S.

License Tax

State Grant for Forest Land Conservation

Deduction Deduction Deduction

3

3

3

Estimate not available at this time

Estimate not available at this time

10.00000

Special assessment of forest land conservation use property

State Grant

Credit

14

17

21

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Summary of State Tax Expenditures

$ in Millions

Expenditure Summary
Title Fee for Motor Vehicles

Tax

Type of

State FY State FY State FY

Expenditure

2012

2013

2014

11.001 11.002

Exemption for a vehicle when transferred between immediate family members as a result of the death of an immediate family member Exemption for the sale of a vehicle to a serviceconnected disabled veteran when the veteran received a grant from the United States Department of Veterans Affairs to purchase and specially adapt the vehicle to his or her disability

Title Fee Title Fee

Exemption Exemption

Estimate not available at this time Estimate not available at this time

35 | P a g e

1. Personal Income Tax
The personal income tax was first levied in Georgia in 1929 at a rate equal to one third the federal rate of income taxation. The current rate structure which includes 6 brackets, ranging from 1 percent to 6 percent, has remained unchanged since 1955 when the 7 percent rate on taxable incomes over $20,000 was eliminated. The threshold for each bracket depends on the filing status of the taxpayer, i.e. single or head of household, married filing separate or joint. The individual income tax collections equaled $7.7 billion in FY2011 and accounted for 50 percent of Georgia's revenues from taxation. In CY2011, 4.2 million individual returns were filed with the state. While predominately paid by individuals, a significant number of business activities are organized so that income associated with these enterprises is reported through the individual income tax. All revenue collected from the individual income tax is deposited in the state general fund.
The initial base of the Georgia individual income tax is the taxpayer's federal adjusted gross income (AGI). Several adjustments are made to this starting point to arrive at the version of adjusted gross income adopted by Georgia. After computing the Georgia version of AGI, taxpayers deduct an amount representing either the value of their Georgia itemized deductions or the Georgia standard deduction. In addition, for tax year 2012 and before, filers are allowed a personal exemption of $5,400 for joint filers and $2,700 for other filers and $3,000 for each dependent. For tax years after 2012, the personal exemption for joint filers will be $7,400 and will be $3,700 for married taxpayers filing a separate return.
The tax expenditure report includes the expenditures associated with both state and federal tax provisions. Because the Georgia individual income tax is based on the federal system, expenditures that are present at the federal level have revenue implications at the state level. For example, changes to itemized deductions by the federal government have repercussions on Georgia state tax revenues. The value of the expenditure as it relates to state taxes paid by those filing a Georgia return is presented in the section below on federal tax expenditures. In some cases, Georgia might not adopt a federal deduction. In that case, the expenditure is not listed because there is no loss of revenue to the state. In general, the value of the federal tax expenditure to the state of Georgia is determined by allocating a portion of the federal tax base associated with the expenditure estimate as estimated by the Joint Committee on Taxation for the U.S. Congress. The data and estimate reliability for the conformity provisions are considered class A. In some cases though, the value of the Georgia estimates are highly sensitive to the assumptions made concerning the appropriate tax rate for a given expenditure provision and the allocation factor that is used to determine the amount of federal activity associated with Georgia. The estimates associated with the federal conformity provisions are based on current law as it existed in November 2012. Therefore, any changes to provisions that may occur because of federal legislative action that occurred after that period are not reflected in the estimates.
36 | P a g e

The explanation of the federal conformity provisions was taken from Tax Expenditures: Compendium of Background Material in Individual Provisions, published by the Committee on the Budget, United States Senate and prepared by the Congressional Research Service, December 2010.
37 | P a g e

1.1 Federal Exclusions

1.1.001

Exclusion of employee meals and lodging

Federal Statute IRC section 119 and 132(e)(2)

Description: Employees are allowed to exclude the fair market value of meals and

lodging furnished by employers if provided on the employer's

premises for the convenience of the employer.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

8

8

9

(m) Denotes a value of less than $1 million

1.1.002

Exclusion of housing allowances for ministers

Federal Statute IRC Section 107 and 265

Description: In general, this provision allows ministers to deduct certain housing

related expenditures from their gross income.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

5

5

5

(m) Denotes a value of less than $1 million

1.1.003

Exclusion of employer-provided child care

Federal Statute IRC Section 129

Description: Payments by an employer, under a dependent care assistance

program, for qualified dependent care assistance provided to an

employee are excluded from the employee's income.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

13 10

9

(m) Denotes a value of less than $1 million

1.1.004

Exclusion of employee awards

Federal Statute IRC Section 74(c) and 274(j)

Description: This provision provides an exclusion for certain awards of tangible

personal property given to employees for length of service or for

safety achievement.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

2

2

2

(m) Denotes a value of less than $1 million

1.1.005

Exclusion of employer contributions and earnings to pension plans. (Includes Keoghs, defined benefit and defined contribution plans) Federal Statute IRC Sections 401-407, 410-418E, and 457 Description: Employer contributions to qualified pension, profit-sharing, stock-
bonus, and annuity plans on behalf of an employee are not taxable to the employee. Furthermore, the employee is generally not taxed on

38 | P a g e

the benefits when they are distributed.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

848 994 1,132

(m) Denotes a value of less than $1 million

1.1.006

Exclusion for employer contributions for health care, health insurance premiums and

long-term care insurance premiums

Federal Statute IRC Sections 105,106, and 125

Description: Employees are allowed to exclude contributions by their employers for

health care coverage for themselves and their dependents.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

831 959 1,073

(m) Denotes a value of less than $1 million

1.1.007

Exclusion for employer paid accident and disability premiums

Federal Statute IRC Sections 105 and 106

Description: Premiums paid by employers for employee accident and disability

insurance plans are excluded from the taxable income of employees.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

23 24

25

(m) Denotes a value of less than $1 million

1.1.008

Exclusion for employer contributions for premiums on group long term life insurance

Federal Statute IRC Section 79

Description: Premiums paid by the employer for qualified group-term life insurance

plans for the employee are excluded from employee's taxable

income.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

11 12

13

(m) Denotes a value of less than $1 million

1.1.009

Exclusion for employer-paid transportation benefits and employer-provided transit

and vanpool benefits

Federal Statute IRC Section 132(f)

Description: Employer provided qualified transportation benefits are excluded from

employee taxable income.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

33 35

36

(m) Denotes a value of less than $1 million

1.1.010 Exclusion for benefits provided through cafeteria plans Federal Statute IRC Section 125

39 | P a g e

Description: Qualified benefits offered through an employer's cafeteria plan are not

included as taxable income to the employee.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

232 260 286

(m) Denotes a value of less than $1 million

1.1.011

Exclusion for employer provided adoption assistance

Federal Statute IRC Section 137

Description: Benefits received from a qualified employer-sponsored adoption

assistance program are excludable from taxable income for the

employee.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

3

1

(m)

(m) Denotes a value of less than $1 million

1.1.012

Exclusion for employer provided education benefits (including education assistance

and tuition reduction benefits)

Federal Statute IRC Section 117(d) and Section 127

Description: Tuition reductions for employees of educational institutions may be

excluded from taxable income. In addition, an employee may exclude

amounts paid by the employer for qualified educational assistance

programs.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

7

7

7

(m) Denotes a value of less than $1 million

1.1.013

Exclusion of miscellaneous fringe benefits

Federal Statute IRC Section 132 and 117(D)

Description: Certain miscellaneous fringe benefits provided by employers,

including services provided at no additional costs, employee discounts,

working condition fringes, de minimus fringes and certain tuition

reductions, can be excluded from the employee's taxable income.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

43 44

44

(m) Denotes a value of less than $1 million

1.1.014

Exclusion of foreign earned income (including housing and salary) Federal Statute IRC Section 911 Description: U.S. taxpayers who live and work abroad are allowed a capped
exclusion of their wage and salary income. In addition, qualified individuals can also exclude certain excess foreign housing costs. This provision does not apply to federal employees working abroad.

40 | P a g e

State Tax Expenditure
(m) Denotes a value of less than $1 million

State Fiscal Years ($ in Millions)

2012 2013 2014

42 43

44

1.1.015

Exclusion of certain allowances for federal employees abroad

Federal Statute IRC Section 912

Description: U.S. federal civilian employees who work abroad are allowed to

exclude from taxable income certain special allowances they receive

that are generally linked to the cost of living.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

14 15

16

(m) Denotes a value of less than $1 million

1.1.016

Exclusion of benefits and allowances to armed forces personnel (includes

expenditure for military disability benefits)

Federal Statute IRC Section 112, 134, 104(a)(4) or (5) and 104(b)

Description: Military personnel are provided with a variety of in-kind benefits (or

cash payments in lieu of such benefits) that are not taxed. In addition,

certain members of the armed forces are eligible for tax exclusion of

disability pay.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

81 89

96

(m) Denotes a value of less than $1 million

1.1.017

Medical care and Tricare Medical Insurance for military dependents and retirees

Federal Statute IRC Section 134

Description: Military personnel are provided with a variety of in-kind benefits (or

cash payments in lieu of such benefits) that are not taxed. In addition,

certain members of the armed forces are eligible for tax exclusion of

disability pay.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

39 40

41

(m) Denotes a value of less than $1 million

1.1.018

Exclusion for Veterans' Benefits (includes veteran's disability compensation,

pensions, and readjustment benefits)

Federal Statute 38 U.S.C. Section 5301

Description: All benefits administered by the Department of Veteran's Affairs are

exempt from income.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

48 49

49

(m) Denotes a value of less than $1 million

41 | P a g e

1.1.019

Exclusion of income attributable to the discharge of certain student loan debt and

NHSC and certain state educational loan repayments

Federal Statute IRC Section 108(f)

Description: This section provides that in certain instances, student loan

cancellation and student loan repayment assistance may be excluded

from gross income.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

1.1.020

Exclusion of Workers' Compensation benefits (includes disability and survivor

benefits and medical benefits, and exclusion of damages on account of personal

physical injuries or physical sickness)

Federal Statute IRC Section 104(a)(1)-(5)

Description: Employees are not taxed on the value of insurance contributions for

workers' compensation medical benefits made on their behalf by

employers, or on the medical benefits or reimbursements they actually

receive. Workers' compensation benefits to employees in cases of

work-related injury and to survivors in cases of work-related death,

are not taxable. Damages paid, through either a court award or a

settlement, to compensate for physical injury and sickness are not

included in income of the recipient.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

69 68

68

(m) Denotes a value of less than $1 million

1.1.021

Exclusion for special benefits for disabled coal miners

Federal Statute IRC Section 104(a)(1)

Description: Cash and medical benefits to coal mine workers or their survivors for

total disability or death resulting from coal workers' pneumoconiosis

(black lung disease) paid under the Black Lung Benefits Act generally

are not taxable.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

1.1.022

Exclusion of untaxed Social Security and railroad retirement benefits

Federal Statute IRC Section 86

Description: In general, Social Security and Railroad retirement benefits are not

subject to tax.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

175 199 223

(m) Denotes a value of less than $1 million

42 | P a g e

1.1.023

Exclusion of Medicare benefits

Federal Statute Rev. Rul. 70-341, IRC Section 139A, Section 112 and 134

Description: The employer's share of the payroll tax is excluded from an

employee's taxable income. Transfers from the general fund of the

U.S Treasury to pay for the cost of covered services are excluded

from the taxable income of enrollees. Transfers from the general fund

of the U.S. Treasury and state governments to pay for the cost of the

drug benefit not covered by premiums are excluded from the taxable

income of enrollees. Employers who choose to receive subsidy

payments are allowed to exclude them from their taxable income.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

360 405 443

(m) Denotes a value of less than $1 million

1.1.024

Exclusion of certain foster care payments

Federal Statute IRC Section 131

Description: Qualified payments are excluded from the foster care provider's gross

income.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

2

2

2

(m) Denotes a value of less than $1 million

1.1.025

Exclusion of cash public assistance benefits

Federal Statute IRC Section 61

Description: Cash benefits provided on a needs basis by the Federal Government

are not included in taxable income.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

37 43

45

(m) Denotes a value of less than $1 million

1.1.026

Exclusion of scholarship and fellowship income

Federal Statute IRC Section 117

Description: Scholarships and fellowships can be excluded from the gross income

of students and their families provided: (1) the students are pursuing

degrees and (2) the amounts are used for tuition and fees required for

enrollment or for books, supplies, fees, and equipment required for

courses at a qualified institution. Amounts used for room, board and

incidental expenses are not excluded from gross income.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

14 15

16

(m) Denotes a value of less than $1 million

43 | P a g e

1.1.027

Exclusion for earnings of Coverdell education savings accounts and interest on

educational savings bonds

Federal Statute IRC Section 530

Description: Contributions to a Coverdell Education Savings Account are not

deductible but the earnings grow on a tax deferred basis.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

1

1

1

(m) Denotes a value of less than $1 million

1.1.028

Exclusion of earnings of qualified tuition programs (including prepaid tuition

programs and savings account programs)

Federal Statute IRC Section 529

Description: Contributions to qualified tuition programs are not deductible at the

federal level but earnings accumulate on a tax-deferred basis.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

4

5

6

(m) Denotes a value of less than $1 million

1.1.029

Exclusion for certain agricultural cost-sharing payments

Federal Statute IRC Section 126

Description: Grants made for the purpose of conserving soil and water resources or

protecting the environment are excluded from the recipient's taxable

income.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

1.1.030

Exclusion of discharge of indebtedness for certain farmers

Federal Statute Sections 108 and 1070(b)(4)

Description: The provision allows farmers who are solvent to treat the income

arising from the cancellation of certain indebtedness as if they were

insolvent taxpayers. Under this provision, income that would normally

be subject to tax would be excluded from tax under qualifying

conditions.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

1.1.031

Exclusion of interest on state and local government private activity bonds Federal Statute Various Description: Interest earned on qualified private activity bonds is tax exempt.

44 | P a g e

State Tax Expenditure
(m) Denotes a value of less than $1 million

State Fiscal Years ($ in Millions) 2012 2013 2014 (m) (m) (m)

1.1.032

Exclusion of capital gains from sale of principle residences

Federal Statute IRC Section 121

Description: A taxpayer may exclude from federal income tax up to $250,000 of

capital gain ($500,000 in the case of married taxpayers filing joint

returns) from the sale or exchange of their principal residence.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

163 189 204

(m) Denotes a value of less than $1 million

1.1.033

Exclusion of capital gains at death

Federal Statute IRC Sections 1001,1002,1014,1015,1023,1040,1221, and 1222

Description: A capital gain tax is not imposed on the increased value of an asset

when ownership of the property is transferred as a result of the death

of the owner.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

167 187 225

(m) Denotes a value of less than $1 million

1.1.034

Exclusion of capital gains on gifts

Federal Statute IRC Sections 1001,1002,1014,1015,1023,1040,1221, and 1222

Description: A capital gain tax is not imposed on the increased value of an asset

when ownership of the property is transferred as a gift during the

owner's lifetime.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

37 58

28

(m) Denotes a value of less than $1 million

1.1.035

Exemption from imputed interest rules

Federal Statute IRC Sections 163(e), 483, 1274, and 1274A

Description: Debt instruments for amounts not exceeding an inflation adjusted

maximum, given in exchange for real property, may not have imputed

to them an interest rate greater than 9 percent.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

3

3

3

(m) Denotes a value of less than $1 million

1.1.036 Exclusion of combat pay Federal Statute IRC Section 112

45 | P a g e

Description: Compensation received by active members of the Armed Forces is

excluded from gross income for any month the service member served

in a combat zone or was hospitalized as a result of an injury or illness

incurred while serving in a combat zone.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

18 19

20

(m) Denotes a value of less than $1 million

1.1.037

Exclusion of energy conservation subsidies provided by public utilities

Federal Statute IRC Section 136

Description: In general, this provision allows customers to deduct from their gross

income the value of any subsidy provided by a public utility for the

purchase or installation of any energy conservation measure.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

1.1.038

Exclusion from income attributable to the discharge of principal residence

acquisition indebtedness

Federal Statute IRC Section 108

Description: Taxpayers who are insolvent or in bankruptcy may exclude canceled

mortgage debt income from gross income. In addition, discharged

qualified residential debt is excluded from gross income.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

5

3

(m)

(m) Denotes a value of less than $1 million

1.1.039

Exclusion of gain for certain small business stock

Federal Statute IRC Sections 1202 and 303

Description: This provision allows non-corporate taxpayers to exclude from gross

income 50 percent of any gain from the sale or exchange of qualified

small business stock issued after August 10, 1993. When a shareholder

in a closely held business dies there is no reported gain or loss on the

partial redemption of stock.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

2

2

3

(m) Denotes a value of less than $1 million

1.1.040

Exclusion of interest on public purpose State and local government bonds Federal Statute IRC Sections 103, 141 and 146 Description: Interest income of qualifying governmental bonds is excluded from
taxable income (expenditure estimate has been adjusted to reflect GA law that only interest on GA bonds is excluded from income).

46 | P a g e

State Tax Expenditure
(m) Denotes a value of less than $1 million

State Fiscal Years ($ in Millions)

2012 2013 2014

2

2

2

1.1.041

Exclusion of income earned by voluntary employees' beneficiary associations

Federal Statute IRC Sections 501(a) and 501(c)(9)

Description: Provided certain requirements are met, the income earned by a

voluntary employee beneficiary association (VEBA) is exempt from

federal income taxes.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

22 24

26

(m) Denotes a value of less than $1 million

1.1.042

Exclusion of survivor annuities paid to families of public safety officers killed in the

line of duty

Federal Statute IRC Section 101(h)

Description: The surviving spouse of a public safety officer killed in the line of

duty can exclude from gross income a survivor annuity payment under

a governmental pension plan.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

1.1.043

Exclusion of disaster mitigation payments

Federal Statute IRC Section 139

Description: Payments made for disaster mitigation under the Robert T. Stafford

Disaster Relief and Emergency Insurance Act or the National Flood

Insurance Act are excluded from income.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

47 | P a g e

1.2 Federal Deductions

1.2.001

Accelerated depreciation (MACRS)

Federal Statute IRC Sections 167 and 168

Description: Under the Modified Accelerated Cost Recovery System (MACRS)

the cost of tangible depreciation property of certain energy property is

allowed a shorter depreciation period. Taxpayers are allowed to

deduct the costs of new rental housing and buildings other than rental

housing and equipment to be depreciated on an accelerated schedule.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

46 44

42

(m) Denotes a value of less than $1 million

1.2.002

Deduction for expenditures on energy-efficient commercial building property

Federal Statute IRC Section 179D

Description: This provision provides a formula-based tax deduction for all or part

of the cost of energy-efficient commercial building property placed in

service after 12/31/2005 and before 1/1/2014.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

1

1

1

(m) Denotes a value of less than $1 million

1.2.003

Deduction of exploration and development costs of nonfuel minerals. (Includes

excess of depletion over cost depletion, nonfuel minerals)

Federal Statute IRC Sections 263, 291, 616-617,56,1254

Description: Firms engaged in mining are permitted to expense certain exploration

and development costs.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

1.2.004

Amortization of business startup costs

Federal Statute IRC Section 195

Description: This provision allows a business taxpayer to deduct up to $10,000 in

qualified start-up expenditures.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

11 10

9

(m) Denotes a value of less than $1 million

1.2.005 Expensing of research and development costs in lieu of R&D tax credit Federal Statute IRC Section 174

48 | P a g e

Description: This provision allows a business taxpayer to deduct certain research

expenditures that are paid or incurred in connection with the taxpayer's

trade or business.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

1.2.006

Expensing of magazine circulation expenditures

Federal Statute IRC Section 173

Description: In general, current federal tax law allows publishers of newspapers,

magazines, and other periodicals to deduct their expenditures to

maintain, establish, or increase circulation in the year in which they

are made.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

1.2.007

Deductions for oil and gas exploration and development costs

Federal Statute IRC Sections 611, 612,613,613A and 291; 263(c), 616-617,

57(a)(2), 59(e) and 1254

Description: Firms that extract oil, gas or other minerals are permitted a deduction

to recover their capital investment in a mineral reserve, which

depreciates due to the physical and economic depletion or exhaustion

as the mineral is recovered. Firms engaged in the exploration and

development of oil, gas or geothermal properties have the option of

expensing certain intangible drilling and development costs.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

1.2.008

Special treatment for expenses related to timber production

Federal Statute IRC Sections 194, 263A(c)(5)

Description: This provision allows expensing of production costs of growing

timber. Taxpayers are also allowed different depreciation practices for

qualified reforestation expenses.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

2

2

2

(m) Denotes a value of less than $1 million

1.2.009

Expensing under IRC section 179 of depreciable business property Federal Statute IRC Section 179 Description: Within certain limits, a taxpayer may elect to deduct as a current
expense the cost of qualifying property in the tax year when it is placed in service.

49 | P a g e

State Tax Expenditure
(m) Denotes a value of less than $1 million

State Fiscal Years ($ in Millions)

2012 2013 2014

24 14

-6

1.2.010

Exceptions for publicly traded partnership with qualified income derived from

certain energy-related activities

Federal Statute IRC Section 7704

Description: This code section allows publicly traded partnerships to be treated as a

corporation for the purposes of the federal income tax under most

situations.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

1

1

1

(m) Denotes a value of less than $1 million

1.2.011

Treatment of income from exploration and mining as qualified income for publicly

traded partnerships

Federal Statute IRC Section 7704

Description: This code section allows publicly traded partnerships to be treated as a

corporation for the purposes of the federal income tax under most

situations.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

1

1

1

(m) Denotes a value of less than $1 million

1.2.012

Various agricultural expense provisions

Federal Statute IRC Sections 175, 180, 1231

Description: Taxpayers in the business of farming may choose to expense costs

associated with soil and water conservation, soil conditioning and the

costs associated with raising dairy and breeding cattle.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

1.2.013

Community and regional development incentives

Federal Statute IRC Sections 38(b), 39(d), 45A, 280C(a), 1391-1397D

Description: Communities designated as empowerment zones and renewable

communities are eligible for special development incentives.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

50 | P a g e

1.2.014

Expensing to remove architectural and transportation barriers to the handicapped and

elderly

Federal Statute IRC Section 190

Description: This provision allows taxpayers to deduct up to $15,000 of expenses

incurred in a single year for removing physical barriers to handicap or

elderly individuals in qualified facilities or public transportation

vehicles owned or leased by the taxpayer.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

1.2.015

Inventory methods and valuation, including last in first out, lower of cost or market,

specific identification for homogenous products

Federal Statute IRC Sections 475, 491-492

Description: This provision allows taxpayers to use alternative inventory systems to

determine cost of goods sold.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

5

5

5

(m) Denotes a value of less than $1 million

1.2.017

Health Savings Accounts

Federal Statute IRC Section 223

Description: This provision allows taxpayers to deduct their health savings account

contributions from their gross income in determining their taxable

income.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

7

9

11

(m) Denotes a value of less than $1 million

1.2.018

Deduction for property taxes on real property

Federal Statute IRC Section 164

Description: Taxpayers may claim an itemized deduction for property taxes paid on

owner-occupied residences.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

94 98 123

(m) Denotes a value of less than $1 million

1.2.019

Deduction for nonbusiness state and local government income taxes, sales taxes and property taxes Federal Statute IRC Section 164 Description: State and local income, sales and personal property taxes paid by
individuals are deductible from adjusted gross income.

51 | P a g e

State Tax Expenditure
(m) Denotes a value of less than $1 million

State Fiscal Years ($ in Millions) 2012 2013 2014 215 239 295

1.2.020

Deduction for mortgage interest on owner-occupied residences

Federal Statute IRC Section 163(h)

Description: A taxpayer may claim an itemized deduction for "qualified residence

interest" which includes interest paid on a mortgage secured by a

principal residence and a second residence.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

531 555 604

(m) Denotes a value of less than $1 million

1.2.021

Deduction for charitable contributions (includes deductions for health, education, and

other than health and education)

Federal Statute IRC Sections 170 and 642(c)

Description: Subject to certain limitations, charitable contributions may be

deducted by individuals.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

352 394 416

(m) Denotes a value of less than $1 million

1.2.022

Deduction for casualty and theft losses

Federal Statute IRC Sections 165(c)(3), 165(e), 165(h)-165(k)

Description: An individual may claim an itemized deduction for unreimbursed

personal casualty or theft losses up to a specified limit.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

3

3

3

(m) Denotes a value of less than $1 million

1.2.023

Deduction for overnight expenses for National Guard and Reserve members

Federal Statute IRC Sections 162(p) and 62(a)(2)(E)

Description: An above-the-line deduction is available for unreimbursed overnight

travel, meals, and lodging expenses of National Guard and Reserve

members.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

1

1

1

(m) Denotes a value of less than $1 million

1.2.024 Deduction for premiums for qualified mortgage insurance Federal Statute IRC Section 163(h)

52 | P a g e

Description: Qualified mortgage insurance premiums paid with respect to a

qualified residence can be treated as tax deductible residence

interest.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

1 (m)

0

(m) Denotes a value of less than $1 million

1.2.025

Deduction for interest on student loans

Federal Statute IRC Section 221

Description: Taxpayers may deduct interest paid on qualified education loans in

determining their adjusted gross income.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

6

5

3

(m) Denotes a value of less than $1 million

1.2.026

Deduction for higher education expenses

Federal Statute IRC Section 222

Description: Taxpayers may deduct qualified tuition and related expenses for

postsecondary education from their adjusted gross income.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

3

1

0

(m) Denotes a value of less than $1 million

1.2.027

Deduction for teacher classroom expenses

Federal Statute IRC Section 62

Description: An eligible employee of a public or private elementary or secondary

school may claim a deduction for certain unreimbursed

expenses.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

1.2.028

Deduction for health insurance premiums and long-term care insurance premiums by

the self-employed

Federal Statute IRC Section 161(l)

Description: Generally, a self-employed individual may deduct the entire amount

paid for health insurance or long term care insurance.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

21 25

27

(m) Denotes a value of less than $1 million

53 | P a g e

1.2.029

Deduction for medical expenses and long term care expenses

Federal Statute IRC Section 213

Description: Most medical expenses that are paid by an individual but not

reimbursed by an employer or insurance company may be deducted

from taxable income to the extent they exceed 7.5 percent of adjusted

gross income.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

69 84 100

(m) Denotes a value of less than $1 million

1.2.030

Deduction for IRAs, includes traditional IRAs and Roth IRAs.

Federal Statute IRC Sections 219 and 408

Description: Individuals participating in a traditional or Roth IRA are allowed to

deduct contributions in the case of traditional IRAs and distributions in

the case of Roth IRAs. Both exemptions are phased out for higher

income individuals.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

60 80 101

(m) Denotes a value of less than $1 million

54 | P a g e

1.3 Special Federal Conformity Provisions

1.3.001

Like-kind exchanges

Federal Statute IRC Section 1031

Description: When business or investment property is exchanged for property of a

"like kind" no gain or loss is recognized on the exchange and therefore

no tax is paid at the time of the exchange.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

3

4

5

(m) Denotes a value of less than $1 million

1.3.002

Special rules for magazine, paperback book, and record returns

Federal Statute IRC Section 458

Description: Publishers and distributors of magazines, paperbacks, and records may

elect to exclude from gross income for a tax year, the income from

the sale of goods that are returned after the close of the tax year.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

1.3.003

5 year carryback for net operating losses attributable to farming

Federal Statute IRC Section 172

Description: Current law provides a 5 year carryback period for losses related to

farming. The normal carryback period for losses is two years.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

1

1

1

(m) Denotes a value of less than $1 million

1.3.004

Special rules for mining reclamation reserves

Federal Statute IRC Section 468

Description: Electing taxpayers may deduct the current value equivalent of certain

estimated future reclamation and closing costs for mining and solid

waste disposal sites.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

1.3.005

Cash accounting, other than agriculture Federal Statute IRC Sections 446 and 448 Description: The cash method of accounting may be used by any business taxpayer
that is not a tax shelter and falls into at least one of three specified categories.

55 | P a g e

State Tax Expenditure
(m) Denotes a value of less than $1 million

State Fiscal Years ($ in Millions)

2012 2013 2014

8

8

8

1.3.006

Deferral of gain on non-dealer installment sales

Federal Statute IRC Sections 453 and 453A(b)

Description: Some taxpayers are allowed to report some sales using the installment

method of accounting in which the gross profit from the sale is

prorated over the years during which the payments are received.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

2 10

12

(m) Denotes a value of less than $1 million

1.3.007

Completed contract rules

Federal Statute IRC Section 460

Description: Some taxpayers with construction or manufacturing contracts

extending for more than one tax year are allowed to report some or all

of the profit on the contracts under special accounting rules rather than

the normal rules of tax accounting.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

1.3.008

Special treatment of employee stock ownership plans (ESOPs)

Federal Statute IRC Sections 401(a)(28), 404(a)(9), 404(k),

415(c)(6),1042,497(e)(7), 4978,4979A, 422-423

Description: Employer contributions may be deducted as a business expense. In

addition, some contributions are subject to less restrictive limits than

contributions to other employee benefit plans. Tax on qualified

employee stock purchase plans are not taxed when granted or excised.

Tax is deferred until stock is sold.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

3

3

3

(m) Denotes a value of less than $1 million

1.3.009

Income averaging for farmers and fishermen Federal Statute IRC Section 1301 Description: Beginning with tax years after 1997, taxpayers have the option to
calculate their current year income tax by averaging over a prior 3 year period, all or a portion of their income from farming and or fishing.

56 | P a g e

State Tax Expenditure
(m) Denotes a value of less than $1 million

State Fiscal Years ($ in Millions) 2012 2013 2014 (m) (m) (m)

57 | P a g e

1.4 Georgia Exemptions

1.4.001

Personal Exemption

State Statute

48-7-26

Year Enacted

1987

Year Effective

1987

Data Source

DOR Data for 2009

Estimate Reliability

Class A

Data Reliability

Class A

Note

For distributional analysis see Table 3 in the appendix

Description: For tax years 2012 a before Georgia allows a personal exemption

equal to $5,400 for joint returns and $2,700 for taxpayers' filing non-

joint returns. $3,000 is excluded from income for each dependent

claimed on the tax return. For tax years after 2012 the personal

exemption for joint filers will be $7,400 and will be $3,700 for married

taxpayers filing separate return.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

867 937 1,035

(m) Denotes a value of less than $1 million

1.4.002

Retirement Income

State Statute

48-7-27

Year Enacted

1971

Year Effective

1971

Data Source

DOR Data for 2009

Estimate Reliability

Class A

Data Reliability

Class A

Note

For distributional analysis see Table 4 in the appendix.

This estimate differs from earlier reports due to a change in

methodology.

Description: Between 2008 and prior to 2012, a maximum of $35,000 of retirement

income from any source was excluded from income. This income

exclusion may include a maximum of $4,000 of earned income. This

provision applies to individuals aged 62 and above. For tax years

beginning in 2012, individuals aged 65 and above may exclude a

maximum of $65,000 of retirement income.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

603 662 697

(m) Denotes a value of less than $1 million

1.4.003

Exclusion of Federally Taxable Social Security Benefits

State Statute

48-7-27

Year Enacted

1971

Year Effective

1971

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Data Source

DOR Data for 2009

Estimate Reliability

Class A

Data Reliability

Class A

Note

Description: Social Security and tier 1 railroad retirement benefits are excluded

from state taxable income.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

129 135 140

(m) Denotes a value of less than $1 million

1.4.004

Georgia Higher Education Savings Plan Contributions

State Statute

48-7-27

Year Enacted

NA

Year Effective

Taxable years beginning on or after January 1, 2002

Data Source

DOR Data for 2009

Estimate Reliability

Class A

Data Reliability

Class A

Note

For distributional analysis see Table 5 in the appendix; this

estimate differs from earlier reports due to a change in

methodology.

Description: An exemption from income is allowed for contributions to a qualified

higher education savings plan. The exemption is limited to $2,000 per

qualified plan beneficiary.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

3

3

3

(m) Denotes a value of less than $1 million

1.4.005

Interest on U.S. Obligations

State Statute

48-7-27

Year Enacted

1971

Year Effective

1971

Data Source

DOR Data for 2009

Estimate Reliability

Class A

Data Reliability

Class A

Note

For distributional analysis see Table 6 in the appendix

Description: Interest earned on U.S. government bonds and other obligations are

not included as taxable income.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

7

5

6

(m) Denotes a value of less than $1 million

1.4.007

Organ donation expenses

State Statute

48-7-27

Year Enacted

1981

59 | P a g e

Year Effective

Taxable years beginning on or after January 1, 2005

Data Source

2009 Annual Report of the U.S. Organ Procurement and

Transplantation Network and the Scientific Registry of

Transplant Recipients developed by the U.S Department

of Health and Human Services

Estimate Reliability

Class C

Data Reliability

Class B

Note

Description: Expenses associated with the donation of organs in accordance with

the "National Organ Procurement Act". The maximum value of

excluded expenses cannot exceed $10,000.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

1.4.008

Aged 65/Blind Deduction

State Statute

48-7-27

Year Enacted

1971

Year Effective

1971

Data Source

DOR Data for 2009

Estimate Reliability

Class A

Data Reliability

Class A

Note

For distributional analysis see Table 7 in the appendix

Description: Taxpayers aged 65 or older are allowed an annual deduction from

income of $1,300 per taxpayer. Taxpayers who are blind are allowed an

annual deduction from income of $1,300 per taxpayer.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

6

6

7

(m) Denotes a value of less than $1 million

1.4.010

Premiums for high deductible health plans

State Statute

48-7-27

Year Enacted

1981

Year Effective

Taxable years beginning on or after January 1, 2008

Data Source

Kaiser-Health Research and Educational Trust and

America's Health Insurance Plan, Center for Policy and

Research

Estimate Reliability

Class B

Data Reliability

Class A

Note

Description: Taxpayers are allowed to exclude 100 percent of premiums paid for

certain high deductible health plans.

60 | P a g e

State Tax Expenditure
(m) Denotes a value of less than $1 million

State Fiscal Years ($ in Millions)

2012 2013 2014

3

3

7

61 | P a g e

1.5 Georgia Deductions

1.5.001

Standard Deduction

State Statute

48-7-27

Year Enacted

1971

Year Effective

1971

Data Source

DOR Data for 2009

Estimate Reliability

Class A

Data Reliability

Class A

Note

For distributional analysis see Table 8 in the appendix

Description: Taxpayers that do not itemize expenses on their federal return are

allowed a standard deduction equal to $2,300 for head of household and

single filers, $1,500 for married filing separately and $3,000 in the case

of joint filers.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

174 176 178

(m) Denotes a value of less than $1 million

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1.6 Georgia Credits

1.6.001

Rural Physician's Credit

State Statute

48-7-29

Year Enacted

1995

Year Effective

Taxable years beginning on or after January 1, 1996

Data Source

DOR Data for 2010

Estimate Reliability

Class B

Data Reliability

Class B

Note

Description: This credit is for certain physicians practicing in rural counties. The

value of the credit is equal to the lessor of $5,000 or the taxpayer's tax

liability annually and may be claimed for 5 years.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

1

1

1

(m) Denotes a value of less than $1 million

1.6.002

Disabled person's home purchase or retrofit credit

State Statute

48-7-29.1

Year Enacted

1998

Year Effective

Taxable years beginning on or after January 1, 1999

Data Source

DOR Data for 2010

Estimate Reliability

Class B

Data Reliability

Class B

Note

Description: This credit provides a $500 credit for the purchase of a new single-

family home containing accessibility features or for the retrofit of an

existing home.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

1.6.003

Driver Education Credit

State Statute

48-7-29.5

Year Enacted

2000

Year Effective

Taxable years beginning on or after January 1, 2001

Data Source

DOR Data for 2010

Estimate Reliability

Class B

Data Reliability

Class B

Note

Description: This credit provides a credit against income tax for the lesser of $150

or the cost of a qualified driver education class.

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State Tax Expenditure
(m) Denotes a value of less than $1 million

State Fiscal Years ($ in Millions)

2012 2013 2014

1

1

1

1.6.004

Disaster Assistance Credit

State Statute

48-7-29.4

Year Enacted

2000

Year Effective

Taxable years beginning on or after January 1, 2000

Data Source

DOR Data for 2010

Estimate Reliability

Class B

Data Reliability

Class B

Note

Description: This credit is for individuals receiving disaster relief payments from

the Georgia Emergency Management Agency or from the Federal

Emergency Management Agency. The credit amount is the actual

amount of the disaster relief assistance or $500, whichever is less.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

1.6.005

Qualified Caregiving Expense Credit

State Statute

48-7-29.2

Year Enacted

1998

Year Effective

Taxable years beginning on or after January 1, 1999

Data Source

DOR Data for 2010

Estimate Reliability

Class B

Data Reliability

Class B

Note

Description: This credit is for taxpayers with expenses related to the care of a

qualifying family member. The value of the credit is equal to no more

than 10 percent of the total amount expended for qualifying caregiving

expenses. In no event shall the credit exceed $150 or the taxpayer's

income tax liability, whichever is less.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

1.6.006

Tax credit for Life Insurance for Georgia National Guard and Air National Guard

State Statute

48-7-29.9

Year Enacted

2005

Year Effective

Taxable years beginning on or after January 1, 2005

Data Source

DOR Data for 2010 & U.S. Department of Veterans

Affairs

Estimate Reliability

Class A

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Data Reliability

Class A

Note

Description: This credit is available for active duty members of the Georgia

National Guard and Air National Guard on active duty for more than 90

consecutive days and who purchase qualified life insurance through the

Services' Group Life Insurance Program administered by the U.S.

Department of Veterans Affairs. The credit amount is equal to the cost

of the premiums of the life insurance policy.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

1

1

1

(m) Denotes a value of less than $1 million

1.6.007

Child and Dependent Care Credit

State Statute

48-7-29.10

Year Enacted

2006

Year Effective

Taxable years beginning on or after January 1, 2006

Data Source

DOR Data for 2010

Estimate Reliability

Class A

Data Reliability

Class A

Note

Description: This credit is equal to 30 percent of the federal credit claimed for

qualified expenses related to the care of children and dependents.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

34

34

35

(m) Denotes a value of less than $1 million

1.6.008

Adoption of Foster Child Credit

State Statute

48-7-29.15

Year Enacted

2008

Year Effective

Tax years beginning on or after January 1, 2008

Data Source

DOR Data for 2010

Estimate Reliability

Class A

Data Reliability

Class A

Note

Description: Provides an annual tax credit for taxpayers adopting qualified foster

children. The value of the credit is $2,000 per child annually until the

child attains the age of 18. Applies to adoptions occurring in taxable

years beginning on or after January 1, 2008.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

2

3

4

(m) Denotes a value of less than $1 million

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1.6.009

Low-Income Credit

State Statute

48-7A -3

Year Enacted

1991

Year Effective

Taxable years beginning on or after January 1, 1992

Data Source

DOR Data for 2010

Estimate Reliability

Class B

Data Reliability

Class B

Note

Description: Provides a tax credit for low-income individuals. The credit is based on

the taxpayers AGI. The maximum value of the credit is $26 per

dependent. For tax years beginning on January 1, 2010 and after, the

credit is nonrefundable

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

7

7

7

(m) Denotes a value of less than $1 million

1.6.010

Credit for taxes paid to another state

State Statute

48-7-28

Year Enacted

1931

Year Effective

1931

Data Source

DOR Data for 2010

Estimate Reliability

Class A

Data Reliability

Class A

Note

Description: A resident individual with income taxed by another state is allowed a

credit for such tax. The maximum value of this credit is equal to the

amount that would be due if the income were taxed by Georgia.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

174 179 185

(m) Denotes a value of less than $1 million

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The following tax credits are offered to both non-corporate businesses filing a personal income tax return and corporations filing a corporate return. The value of the credits claimed by businesses filing individual returns are reported under the corporate tax section of this report.

Expenditure
1.6.012
1.6.013 1.6.014 1.6.015 1.6.016
1.6.017
1.6.018 1.6.019 1.6.020 1.6.021 1.6.022 1.6.023 1.6.024 1.6.025 1.6.026 1.6.027
1.6.028 1.6.029 1.6.030
1.6.031
1.6.032 1.6.033 1.6.034 1.6.035 1.6.036 1.6.037 1.6.038 1.6.039
1.6.040 1.6.041

Statute
48-7-40 and 48-740.1 48-7-40.17 48-7-40.24 48-7-40.25 48-7-40.2, 48-7-40.3, and 48-7-40.4 48-7-40.7, 48-7-40.8, and 48-7-40.9 48-7-40.15 48-7-40.15A 48-7-40.26 48-7-40.12 48-7-40.27 & 40.28 48-7-29.13 48-7-29.11 48-7-29.3 48-7-40.22 48-7-40.6
48-7-29.6 48-7-29.8 48-7-40.19
48-7-40.16
48-7-29.12 48-7-29.14 48-7-41 48-7-40.5 48-7-29.16 48-7-40.30 48-7-40.29 48-7-40.10
48-7-40.11 48-7-40.21

Corresponding Corporate Credit
Employer's Jobs Tax Credit (2.6.001)
Quality Jobs Tax Credit (2.6.002) New Facilities Jobs Credit (2.6.003) New Manufacturing Facilities Property Credit (2.6.004) Manufacturer's Investment Tax Credit (2.6.005)
Optional Investment Tax Credit (2.6.006)
Port Activity Tax Credit (2.6.007) Alternative Port Activity Tax Credit (2.6.008) Film Tax Credit (2.6.009) Research Tax Credit (2.6.010) Seed-Capital Fund Credit (2.6.011) Qualified Health Insurance Expense Credit (2.6.012) Teleworking Credit (2.6.013) Qualified Transportation Credit (2.6.014) Business Enterprise Vehicle Credit (2.6.015) Employer's credit for providing or sponsoring child care for employees and employer's credit for purchasing child care property (2.6.016) Low Income Housing Credit (2.6.017) Historic Rehabilitation Credit (2.6.018) Diesel Particulate Emission Reduction Technology Equipment Credit (2.6.019) Low/Zero Emission Vehicle Credit & Electric Vehicle Charger Credit (2.6.020) Land Conservation Credit (2.6.021) Clean Energy Property Credit & Wood Residuals Credit (2.6.022) Employer's Credit for Basic Skills Education (2.6.023) Employer's Credit for Approved Employee Retraining (2.6.024) Qualified Education Expense Credit (2.6.025) Qualified Investor Tax Credit (2.6.026) Energy or water efficient equipment credit (2.6.027) Tax credit for water conservation facilities and qualified water conservation investment property (2.6.028) Tax credit for shift from ground water usage (2.6.029) Tax credit for existing business enterprises undergoing qualified business expansion (2.6.030)

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Income tax exemptions for which an estimate is not currently available

Expenditure Statute

Summary

1.4.006

48-7-27 Certain military income

1.4.009

48-7-27 Certain dependent's unearned income

1.4.011

48-7-27 Salaries and wages reduced from Federal taxable income because of the

Federal Jobs Tax Credit

1.4.012

48-7-27 Individual retirement account, Keogh, SEP and Sub-S plan withdrawals

where tax has been paid to Georgia because of the difference between

Georgia and Federal law for tax years 1981 through 1986.

1.4.013

48-7-27 Depreciation because of differences in Georgia and Federal law during

tax years 1981 through 1986.

1.4.014

48-7-27 Income from any fund, program or system which is exempted by federal

law or treaty.

1.4.015

48-7-27 Certain income in which the Sub-S election is not recognized by

Georgia or another state in order to avoid double taxation.

1.4.016

48-7-27 Adjustment for certain teachers retired from the Teacher's Retirement

System of Georgia

1.4.017

48-7-27 Amount claimed by certain employers in food and beverage

establishments

1.4.018

48-7-27 Adjustment of certain payments to minority subcontractors

1.4.019

48-7-27 Adjustments to federal AGI for certain Georgia resident partners

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2. Corporate Income Tax
The corporate income tax was first levied in Georgia in 1929. While originally levied at a rate of 1/3 of the federal corporate tax rate, the rate was changed to 4 percent in 1931. The tax has gone through several rate changes since its introduction, including in 1949 when it was temporarily increased to 7.5 percent. The current rate of 6 percent was adopted in 1969. The Georgia corporate income tax does not include a minimum level of exempt income and includes only one income tax bracket.
Corporate tax collections for FY2011 were $613 million or 4.0 percent of total state tax revenues. Approximately 203,000 corporate returns were processed for FY2011. All revenue collected from this tax is deposited into the state general fund.
The starting point for the construction of the tax base is federal taxable income of a corporation. Several adjustments are made in order to determine Georgia business income. For example, although corporations are allowed certain special depreciation deductions at the federal level, some of these deductions are not allowed at the state level. Firms taking these deductions on their federal return must add these deductions back to their tax base when determining their state taxable income. In addition, firms operating in multiple states must apportion their corporate income to each of the states in which they have a legal obligation to pay the tax. Since 2008 firms with multistate income determine the portion of their total income associated with Georgia by computing their total Georgia receipts relative to their total receipts.
It is important to keep in mind that tax expenditure estimates may differ from revenue estimates presented in fiscal notes. As mentioned in the introduction to this report, the value of tax expenditures may differ from the value of revenue estimates provided in fiscal notes because fiscal notes incorporate behavioral effects that are not considered when estimating tax expenditure provisions. This is because the purpose of a tax expenditure estimate is to convey the cost that would be necessary if the item were offered as a direct budgetary expenditure instead of a reduction in the tax liability.
A second caveat concerns the estimates associated with the state corporate credit provisions. Forecasting the value of the revenue loss stemming from the use of these credits is problematic because of the presence of extensive carry forwards in the case of some credits. Because of past credit carry forwards, firms may claim credits on current or future year tax returns that were created in prior years. Therefore, the estimates provided in this report should be interpreted as the expected revenue loss stemming from the use of currently created or previously created credits and not an estimate of the value of credits created in a given year.
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2.1 Federal Corporate Exclusions

2.1.001

Exemption from imputed interest rules

Federal Statute IRC Sections 163(e), 483, 1274, and 1274(A)

Description: Debt instruments for amounts not exceeding an inflation adjusted

maximum, given in exchange for real property, may not have imputed

to them an interest rate greater than 9 percent.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

2.1.002

Exclusion of interest on state and local government private activity bonds

Federal Statute IRC Section 103,141,142 and 146

Description: Interest earned on qualified private activity bonds is tax exempt.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

2.1.003

Exclusion of contributions in aid of construction for water and sewer utilities

Federal Statute IRC Section 118(c)

Description: Qualifying contributions in aid of construction received by regulated

water and sewage disposal utilities are not included in the utilities'

gross income under certain conditions.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

2.1.004

Exclusion of earnings of certain environmental settlement funds

Federal Statute IRC Section 468B

Description: Under certain conditions, an environmental settlement fund will be

exempt from tax.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

2.1.005

Exclusion for certain agricultural cost-sharing payments

Federal Statute IRC Section 126

Description: Grants made for the purpose of conserving soil and water resources or

protecting the environment are excluded from the recipient's gross

income.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

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2.1.006

Exclusion of gain or loss on sale or exchange for brownfield property

Federal Statute IRC Section 512 and 514

Description: Qualifying brownfield property that is acquired from an unrelated

party, subject to remediation, and sold to another unrelated party is

exempt from unrelated business income tax.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

2.1.007

Exclusion of health insurance benefits for military retirees and retiree dependents

enrolled in Medicare

Federal Statute Rev. Rul. 70-341, IRC Section 139A, Section 112 and 134

Description: Exclusion of health insurance benefits for military retirees and retiree

dependents enrolled in Medicare, retiree dependents enrolled in

Medicare, and exclusion of certain subsidies to employers who

maintain prescription drug plans for Medicare enrollees.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

1

1

(m)

(m) Denotes a value of less than $1 million

2.1.008

Exclusion of disaster mitigation payments

Federal Statute IRC Section 139

Description: Payments made for disaster mitigation under the Robert T. Stafford

Disaster Relief and Emergency Insurance Act or the National Flood

Insurance Act are excluded from income.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

2.1.009

Exclusion of interest on public purpose state and local government bonds

Federal Statute IRC Sections 103, 141 and 146

Description: Interest income of qualifying governmental bonds is excluded from

taxable income.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

2.1.010

Various foreign provisions (Including inventory property sales source rule exception, interest expense allocation, deferral of active income of controlled foreign corporations, deferral of active financing income) Federal Statute IRC Sections 861-863, 865, 953-954, 864 Description: These provisions provide certain exceptions to the general treatment of
foreign sourced income.

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State Tax Expenditure
(m) Denotes a value of less than $1 million

State Fiscal Years ($ in Millions)

2012 2013 2014

63 58

57

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2.2 Federal Corporate Deductions

2.2.001

Accelerated depreciation (MACRS)

Federal Statute Various

Description: Includes - 5 year MACRS for certain energy property, 10 year

MACRS for smart electric distribution, 15 year MACRS for certain

electric transmission property, 15 year MACRS for natural gas

distribution; depreciation of rental housing, buildings other than rental

housing, and equipment in excess of alternative depreciation system

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

29 30

31

(m) Denotes a value of less than $1 million

2.2.002

Deduction for expenditures on energy-efficient commercial building property

Federal Statute IRC Section 179D

Description: This provision provides a formula-based tax deduction for all or part

of the cost of energy-efficient commercial building property placed in

service after 12/31/2005 and before 1/1/2014.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

2.2.003

Deduction of exploration and development costs of nonfuel minerals

Federal Statute IRC Sections 263, 291, 616-617,56,1254

Description: Firms engaged in mining are permitted to expense certain exploration

and development costs.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

2.2.004

Amortization of business startup costs

Federal Statute IRC Section 195

Description: This provision allows a business taxpayer to deduct up to $10,000 in

qualified start-up expenditures.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

2.2.005

Expensing of research and development costs in lieu of R&D tax credit Federal Statute IRC Section 174 Description: This provision allows a business taxpayer to deduct certain research
expenditures that are paid or incurred in connection with the taxpayer's trade or business.

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State Tax Expenditure
(m) Denotes a value of less than $1 million

State Fiscal Years ($ in Millions)

2012 2013 2014

5

6

7

2.2.006

Expensing of magazine circulation expenditures

Federal Statute IRC Section 173

Description: In general, current federal tax law allows publishers of newspapers,

magazines, and other periodicals to deduct their expenditures to

maintain, establish, or increase circulation in the year in which they

are made.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

2.2.007

Deductions for oil and gas exploration and development costs

Federal Statute IRC Sections 611, 612,613,613A and 291; 263(c), 616-617,

57(a)(2), 59(e) and 1254

Description: Firms that extract oil, gas or other minerals are permitted a deduction

to recover their capital investment in a mineral reserve, which

depreciates due to the physical and economic depletion or exhaustion

as the mineral is recovered. Firms engaged in the exploration and

development of oil, gas or geothermal properties have the option of

expensing certain intangible drilling and development costs.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

2.2.008

Special treatment for expenses related to timber production

Federal Statute IRC Sections 194, 263A(c)(5)

Description: This provision allows expensing of production costs of growing

timber. Taxpayers are also allowed different depreciation practices for

qualified reforestation expenses.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

3

3

3

(m) Denotes a value of less than $1 million

2.2.009

Deduction for charitable contributions (includes deductions for health, education, and other than health and education) Federal Statute IRC Sections 170 and 642(c) Description: Subject to certain limitations, charitable contributions may be
deducted by individuals.

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State Tax Expenditure
(m) Denotes a value of less than $1 million

State Fiscal Years ($ in Millions)

2012 2013 2014

12 12

12

2.2.011

Expensing under IRC section 179 of depreciable business property

Federal Statute IRC Section 179

Description: Within certain limits, a taxpayer may elect to deduct as a current

expense the cost of qualifying property in the tax year when it is

placed in service.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

2 (m) (-m)

(m) Denotes a value of less than $1 million

2.2.012

Amortization of air pollution control facilities

Federal Statute IRC Section 169(d)(5)

Description: This provision allows plants placed in service after 1/1/1976 the option

of amortizing investments in pollution control equipment for coal-fired

electric generation plants.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

1

1

1

(m) Denotes a value of less than $1 million

2.2.013

Election to expense 50 percent of qualified property used to refine liquid fuels

Federal Statute IRC Section 179C and 168

Description: Taxpayers may elect to expense 50 percent of the cost of qualified

refinery property used to process liquid fuel from crude oil and other

qualified fuels.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

2.2.014

Various agricultural expensing provisions

Federal Statute IRC Section 175, 180, 1231

Description: Taxpayers in the business of farming may choose to expense costs

associated with soil and water conservation, soil conditioning and the

costs associated with raising dairy and breeding cattle.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

2.2.015 Community and regional development incentives Federal Statute IRC Sections 38(b), 39(d), 45A, 280C(a), 1391-1397D

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Description: Communities designated as empowerment zones and renewable

communities are eligible for special development incentives.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

2.2.016

Expensing to remove architectural and transportation barriers to the handicapped and

elderly

Federal Statute IRC Section 190

Description: This provision allows taxpayers to deduct up to $15,000 of expenses

incurred in a single year for removing physical barriers to handicap or

elderly individuals in qualified facilities or public transportation

vehicles owned or leased by the taxpayer.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

2.2.017

Inventory methods and valuation

Federal Statute IRC Section 475, 491-492

Description: This provision allows taxpayers to use alternative inventory systems to

determine cost of goods sold.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

14 15

15

(m) Denotes a value of less than $1 million

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2.3 Special Federal Corporate Conformity Provisions

2.3.001

Like-kind exchanges

Federal Statute IRC Section 1031

Description: When business or investment property is exchanged for property of a

"like kind" no gain or loss is recognized on the exchange and therefore

no tax is paid at the time of the exchange.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

4

4

5

(m) Denotes a value of less than $1 million

2.3.002

Special rules for magazine, paperback book, and record returns

Federal Statute IRC Section 458

Description: Publishers and distributors of magazines, paperbacks, and records may

elect to exclude from gross income for a tax year, the income from

the sale of goods that are returned after the close of the tax year.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

2.3.003

5 year carryback for net operating losses attributable to farming

Federal Statute IRC Section 172

Description: Current law provides a 5 year carryback period for losses related to

farming. The normal carryback period for losses is two years.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

2.3.004

Special rules for mining reclamation reserves

Federal Statute IRC Section 468

Description: Electing taxpayers may deduct the current value equivalent of certain

estimated future reclamation and closing costs for mining and solid

waste disposal sites.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

2.3.005

Cash accounting, other than agriculture Federal Statute IRC Sections 446 and 448 Description: The cash method of accounting may be used by any business taxpayer
that is not a tax shelter and falls into at least one of three specified categories.

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State Tax Expenditure
(m) Denotes a value of less than $1 million

State Fiscal Years ($ in Millions) 2012 2013 2014 (m) (m) (m)

2.3.006

Deferral of gain on non-dealer installment sales

Federal Statute IRC Sections 453 and 453A(b)

Description: Some taxpayers are allowed to report some sales using the installment

method of accounting in which the gross profit from the sale is

prorated over the years during which the payments are received.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

11 15

15

(m) Denotes a value of less than $1 million

2.3.007

Completed contract rules

Federal Statute IRC Section 460

Description: Some taxpayers with construction or manufacturing contracts

extending for more than one tax year are allowed to report some or all

of the profit on the contracts under special accounting rules rather than

the normal rules of tax accounting.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

2

3

3

(m) Denotes a value of less than $1 million

2.3.008

Special treatment of employee stock ownership plans (ESOPs)

Federal Statute IRC Sections 401(a)(28), 404(a)(9), 404(k),

415(c)(6),1042,497(e)(7), 4978,4979A, 422-423

Description: ESOPs are provided with special tax treatment. Employer

contributions may be deducted as a business expense. In addition,

some contributions are subject to less restrictive limits than

contributions to other employee benefit plans. Tax on qualified

employee stock purchase plans are not taxed when granted or excised.

Tax is deferred until stock is sold.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

-1 -1

-1

(m) Denotes a value of less than $1 million

2.3.009

Deferral of capital construction costs of shipping companies Federal Statute IRC Section 7518 Description: U.S. operators of vessels in foreign, Great Lakes, or noncontiguous
domestic trade, or in U.S. fisheries, may establish a capital construction fund into which they may make certain tax deductible deposits. In addition, the earnings on the deposits are tax deferred.

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State Tax Expenditure
(m) Denotes a value of less than $1 million

State Fiscal Years ($ in Millions) 2012 2013 2014 (m) (m) (m)

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2.4 Corporate Apportionment
Discussed below are three issues relating to corporate apportionment that can be considered tax expenditures because they are deviations from the standard practice of corporate apportionment and result in a benefit to some taxpayers. No estimate of the value of these expenditures is available at this time.

2.4.001

Single Factor Apportionment

With single factor apportionment, firms determine state tax liability based solely on the ratio of Georgia receipts to total receipts. The traditional apportionment formula involves the use of three Georgia-total ratios: property, payroll, and receipts. With the 3 factor formula the firm applies a weight of 33.33 percent to each ratio. The single factor formula benefits firms that have manufacturing presence in one state but significant sales outside of the state. Firms that are located and operate in a single state are not affected by the apportionment formula.

2.4.002

Throwback Rule

Under a throwback rule, out-of-state sales from a corporation are taxed by the state of origin if the corporation has no nexus in the destination state. At least 25 states have a throwback rule. Georgia, North Carolina, Florida, Tennessee, South Carolina, and Virginia do not but Alabama does. An alternative rule is the "throwout rule" which eliminates sales to non-nexus states from both the numerator and denominator of the apportionment formula of a corporation. Georgia does not have a throwout rule.

2.4.003

Corporate Receipts Sourcing

Georgia is among 12 states that apportion multistate corporate income based only on gross receipts, (i.e. a 100% sales factor). This creates a destination-based corporate income tax system. Under this approach, corporations pay taxes based on the state in which their products are sold, not where production takes place. This rule applies to the sale of tangible property. When considering apportionment for services provided across state lines, Georgia employs a market-based sourcing rule. At the present, there is no consensus between the states on how to define a "market" for the purpose of implementing this rule but, in general, it means that services will be taxed based on the state in which the customer receives the benefit. The rule is meant to apply a consistent destination-based treatment to services when compared to tangible goods.

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Corporate apportionment expenditures for which an estimate is not

currently available

Expenditure Statute

2.4.001

48-7-31

Summary
Single factor apportionment

2.4.002

Not applicable

Throwback Rule

2.4.003

48-7-31(d)(2)(A)(i) & Georgia Revenue Rules & Regulations 560-7-7-.03(5)(c)1

Corporate receipts sourcing

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2.5 Georgia Deductions

Corporate income tax deductions for which an estimate is not currently

available

Expenditure Statute

Summary

2.5.001

48-7-21

Interest on obligations of United States

2.5.002

48-7-21

Exception to intangible expenses and related interest cost

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2.6 Georgia Credits

2.6.001

Employer's Job Tax Credit

State Statute

48-7-40 and 48-7-40.1

Year Enacted

48-7-40: 1989; 48-7-40.1: 1993

Year Effective

48-7-40: Taxable years beginning on or after January 1,

1990; 48-7-40.1: Taxable years beginning on or after

January 1, 1994.

Data Source

DOR Data for 2010

Estimate Reliability

Class A

Data Reliability

Class A

Note

Estimate includes tax credit for expanding business

(2.6.030) and the new facilities job credit (2.6.003); this

estimate differs from earlier reports due to newly available

data.

Description: The credit provides a statewide job tax credit to any business or

headquarters engaged in manufacturing, warehousing and distribution,

processing, telecommunications, broadcasting, tourism, or research and

development. Retail establishments are only allowed the credit if

located in one of the 40 least developed counties of the state. Average

wages must be greater than the average wage of the county in the

state with the lowest average wage. To be eligible, employers must

offer health insurance to all new employees.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

39

44

48

(m) Denotes a value of less than $1 million

2.6.002

Quality Jobs Tax Credit

State Statute

48-7-40.17

Year Enacted

2009

Year Effective

Taxable years beginning on or after January 1, 2009

Data Source

DOR Data for 2010

Estimate Reliability

Class B

Data Reliability

Class B

Note

Description: This credit is for employers creating new high-wage jobs or relocating

high-wage jobs into the state. A quality job or high-wage job is defined

as a job located in the state; has 30 hours a week of regular work; a job

that is not already located in Georgia; and pays at or above 110

percent of the average wage of the county in which it is located.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

3

4

5

(m) Denotes a value of less than $1 million

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2.6.003

New Facilities Jobs Credit

State Statute

48-7-40.24

Year Enacted

2003

Year Effective

Latest modifications are effective for taxable years

beginning on or after January 1, 2009

Data Source

DOR Data for 2010

Estimate Reliability

Class A

Data Reliability

Class A

Note

Description: For business enterprises that first qualified in a taxable year beginning

before January 1, 2009, $450 million in qualified investment property

must be purchased for the project within a six-year period. The

manufacturer must also create at a minimum 1,800 new jobs within a

six-year period and can receive credit for up to a maximum of 4,500

jobs. For business enterprises who first qualify in a taxable year

beginning on or after January 1, 2009, the business enterprise must

meet the job creation requirement of 1,800 eligible full-time employees

and either the qualified investment requirement of $450 million in

qualified investment property, or the payroll requirement of $150

million in total annual Georgia W-2 reported payroll within the

six-year period.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

Included in 2.6.001

(m) Denotes a value of less than $1 million

2.6.005

Manufacturer's Investment Tax Credit

State Statute

48-7-40.2, 48-7-40.3, and 48-7-40.4

Year Enacted

1994

Year Effective

Taxable years beginning on or after January 1, 1994

Data Source

DOR Data for 2010

Estimate Reliability

Class A

Data Reliability

Class A

Note

Description: Taxpayer must invest a minimum of $50,000 per project per location

during the tax year to receive credit. Eligible taxpayers must have been

in operation for the immediately preceding three years. Leased

property for a period of 5 years or longer is eligible for the credit.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

7

8

9

(m) Denotes a value of less than $1 million

2.6.006

Optional Investment Tax Credit

State Statute

48-7-40.7, 48-7-40.8, and 48-7-40.9

Year Enacted

1995

Year Effective

Taxable years beginning on or after January 1, 1996.

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Data Source

DOR Data for 2010

Estimate Reliability

Class A

Data Reliability

Class A

Note

Description: An alternative investment tax credit available for investments in

manufacturing or telecommunications facilities or support facilities that

has been operating for the three immediately preceding years. The

credit is available for investments in excess of $5 million and placed in

service no earlier than January 1, 1996 for Tier 1 counties. The

investment threshold is $10 million for Tier 2 counties and is $20

million for Tier 3 and 4 counties.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

1

1

1

(m) Denotes a value of less than $1 million

2.6.007

Port Activity Tax Credit

State Statute

48-7-40.15

Year Enacted

1998

Year Effective

Latest modifications apply to taxable years beginning on

or after January 1, 2010

Data Source

DOR Data for 2010

Estimate Reliability

Class A

Data Reliability

Class A

Note

Estimate combined with 2.6.008

Description: For taxable years beginning before January 1, 2010, businesses or the

headquarters of any such businesses engaged in manufacturing,

warehousing and distribution, processing, telecommunications,

broadcasting, tourism, or research and development that have increased

shipments out of Georgia ports during the previous 12-month period

by more than 10% over their 1997 base year port traffic, or by more

than 10% over 75 net tons, five containers or ten 20-foot equivalent

units (TEU's) during the previous 12-month period are qualified for

increased job tax credits or investment tax credits. For taxable

beginning on or after January 1, 2010, the increase is based on a

comparison of the previous 12 month period to the second preceding 12

month period.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

7

7

7

(m) Denotes a value of less than $1 million

2.6.008

Alternative Port Activity Tax Credit

State Statute

48-7-40.15A

Year Enacted

2009

Year Effective

2009

Data Source

DOR Data for 2010

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Estimate Reliability

Class A

Data Reliability

Class A

Note

Estimate combined with 2.6.007

Description: Credit is allowed to any business enterprise located in a Tier 2 or 3

county or in a less developed area and which qualifies and receives the

Jobs Tax Credit and which

1. Consists of a distribution facility of greater than 650,000 square feet

in operation in this state prior to December 31, 2008;

2. Distributes product to retail stores owned by the same legal entity or

its subsidiaries as such distribution facility; and

3. Has a minimum of 8 retail stores in this state in the first year of

operations.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

Included in 2.6.007

(m) Denotes a value of less than $1 million

2.6.009

Film Tax Credit

State Statute

48-7-40.26

Year Enacted

2005

Year Effective

Taxable years beginning on or after January 1, 2005

Data Source

DOR Data for 2010

Estimate Reliability

Class B

Data Reliability

Class A

Note

This estimate differs from earlier reports due to newly

available data.

Description: Production companies which have at least $500,000 of qualified

expenditures in a state certified production may claim this credit.

Certification must be approved through the Georgia Department of

Economic Development. There are special calculation provisions for

production companies whose average annual total production

expenditures in this state exceeded $30 million for 2002, 2003 and

2004.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

65

75

86

(m) Denotes a value of less than $1 million

2.6.010

Research Tax Credit

State Statute

48-7-40.12

Year Enacted

1997

Year Effective

Taxable years beginning on or after January 1, 1998

Data Source

DOR Data for 2010

Estimate Reliability

Class A

Data Reliability

Class A

Note

Description: This credit is for expenses resulting from research conducted in

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Georgia by businesses engaged in manufacturing, warehousing and

distribution, processing, telecommunications, tourism, or research and

development industries. A tax credit is allowed provided that the

business enterprise for the same taxable year claims and is allowed a

research credit under Section 41 of the Internal Revenue Code of 1986,

as amended.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

8

10

13

(m) Denotes a value of less than $1 million

2.6.011

Seed-Capital Fund Credit

State Statute

48-7-40.27 & 40.28

Year Enacted

2008

Year Effective

Applicable to investments made on or after July 1, 2008

Data Source

DOR Data for 2010

Estimate Reliability

Class A

Data Reliability

Class A

Note

Description: This provides a tax credit for certain qualified investments made on or

after July 1, 2008 in a research fund, the purpose of which is to provide

early-stage financing for businesses formed as a result of research

conducted in Georgia's research universities.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

2.6.012

Qualified Health Insurance Expense Credit

State Statute

48-7-29.13

Year Enacted

2008

Year Effective

Taxable years beginning on or after January 1, 2009

Data Source

DOR Data for 2010, America's Health Insurance Plan,

Center for Policy and Research

Estimate Reliability

Class A

Data Reliability

Class A

Note

Description: Employer credit for the premiums paid for a high-deductible health

plan. Employers must employ 50 or fewer persons for whom the

employer provides high deductible health plans as defined by Section

223 of the Internal Revenue Code and in which such employees are

enrolled. The qualified health insurance must be made available to all

employees and compensated individuals of the employer pursuant to

the applicable provisions of Section 125 of the Internal Revenue Code.

The qualified health insurance premium expense must equal at least

$250 annually.

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State Tax Expenditure
(m) Denotes a value of less than $1 million

State Fiscal Years ($ in Millions) 2012 2013 2014 (m) (m) (m)

2.6.013

Teleworking Credit (expired 12/31/2011)

State Statute

48-7-29.11

Year Enacted

2006

Year Effective

July 1, 2007

Data Source

DOR Data for 2010

Estimate Reliability

Class A

Data Reliability

Class A

Note

This credit expired 12/31/2011

Description: Employers who permit their employees to telework will be allowed an

income tax credit for expenses incurred up to $1,200 per participating

employee. In addition, employers are allowed a one-time credit of

$20,000 per employer for preparing an assessment of a teleworking

plan for their business.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

1

0

0

(m) Denotes a value of less than $1 million

2.6.014

Qualified Transportation Credit

State Statute

48-7-29.3

Year Enacted

1999

Year Effective

Taxable years beginning on or after January 1, 2001

Data Source

DOR Data for 2010

Estimate Reliability

Class A

Data Reliability

Class A

Note

Description: A tax credit provided to employers for the cost of providing any

federally qualified transportation benefit to an employee.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

2.6.015

Business Enterprise Vehicle Credit

State Statute

48-7-40.22

Year Enacted

2001

Year Effective

Taxable years beginning on or after January 1, 2002.

Data Source

Georgia Regional Transportation Authority

Estimate Reliability

Class C

Data Reliability

Class A

Note

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Description: This is a credit given to a business enterprise for the purchase of a

motor vehicle that is used exclusively to provide transportation for its

employees. In order to qualify, a business enterprise must certify that

each vehicle carries an average daily ridership of not less than four

employees for an entire taxable year.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

2.6.016

Employer's Credit for providing or sponsoring child care for

employees and employer's credit for purchasing child care property

State Statute

48-7-40.6

Year Enacted

1994 & 1999

Year Effective

Credit for cost of operation-Taxable years beginning on or

after January 1, 1994; Credit for Cost of Qualified Child

Care Property-Taxable years beginning on or after

January 1, 2000.

Data Source

DOR Data for 2010

Estimate Reliability

Class A

Data Reliability

Class A

Note

Description: Tax credit for expenses related to an employer who purchases qualified

child care property; and a tax credit for employers who provide or

sponsor child care for employees.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

8

9

10

(m) Denotes a value of less than $1 million

2.6.017

Low Income Housing Credit

State Statute

48-7-29.6

Year Enacted

2000

Year Effective

Taxable years beginning on or after January 1, 2001.

Data Source

DOR Data for 2010

Estimate Reliability

Class B

Data Reliability

Class A

Note

Description: This is a credit against Georgia income taxes for taxpayers owning

developments which receive the federal Low-Income Housing Tax

Credit and that are placed in service on or after January 1, 2001. A

eligible development consists of a housing project with restricted rents

that do not exceed 30 percent of median income for at least 40 percent

of its units occupied by persons or families having incomes of 60

percent or less of the median income or at least 20 percent of the units

occupied by persons or families having incomes of 50 percent or less of

the median income.

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State Tax Expenditure
(m) Denotes a value of less than $1 million

State Fiscal Years ($ in Millions)

2012 2013 2014

33

36

39

2.6.018

Historic Rehabilitation Credit

State Statute

48-7-29.8

Year Enacted

2002

Year Effective

Taxable years beginning on or after January 1, 2004

Data Source

DOR Data for 2010 and U.S. Joint Committee on Taxation

Estimate Reliability

Class B

Data Reliability

Class A

Note

Description: A credit for the certified rehabilitation of a certified structure or historic

home. Standards set by the Georgia Department of Natural Resources

must be met.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

2.6.019 2.6.020

Diesel Particulate Emission Reduction Technology Equipment

Credit

State Statute

48-7-40.19

Year Enacted

2000

Year Effective

Taxable years beginning on or after January 1, 2001.

Data Source

Officials from the Georgia Air Protection Branch of the

Georgia Department of Natural Resources

Estimate Reliability

Class A

Data Reliability

Class A

Note

Description: This is a credit given to any person who installs diesel particulate

emission reduction equipment at any truck stop, depot, or other facility.

For purposes of this credit diesel particulate emission reduction

technology equipment is any equipment that provides for heat, air

conditioning, light, and communications for the driver's compartment

of a commercial motor vehicle parked at a truck stop, depot, or other

facility the use of which results in the engine being turned off with a

corresponding reduction of particulate emissions from such vehicle's

diesel engine.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

Zero and Low Emission Vehicle Credit; Electric Vehicle Charger

Credit

State Statute

48-7-40.16

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Year Enacted

1998

Year Effective

Taxable years beginning on or after January 1, 1998

Data Source

DOR Data for 2010, U.S. Energy Information

Administration, and U.S. Department of Energy

Estimate Reliability

Class B

Data Reliability

Class A

Note

Description: This is a credit for the purchase or lease of a new low or zero emission

vehicle that is registered in the state of Georgia. The credit also

applies to the conversion of a standard vehicle to a low or zero

emission vehicle. In addition, the credit applies to the purchase of an

electric vehicle charger.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

3

4

4

(m) Denotes a value of less than $1 million

2.6.021

Land Conservation Credit

State Statute

48-7-29.12

Year Enacted

2006

Year Effective

Taxable years beginning on or after January 1, 2006

Data Source

DOR Data for 2010

Estimate Reliability

Class A

Data Reliability

Class A

Note

Description: This is an income tax credit for the qualified donation of real property

that qualifies as conservation land pursuant to Chapter 22 of Title 36.

Property donated to increase building density levels or property that

will be used or is associated with the playing of golf shall not be

eligible.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

19

30

34

(m) Denotes a value of less than $1 million

2.6.022

Clean Energy Property & Wood Residuals Credit

State Statute

48-7-29.14

Year Enacted

2008

Year Effective

July 1, 2008

Data Source

DOR Data for 2012

Estimate Reliability

Class A

Data Reliability

Class A

Note

Description: The Georgia Clean Energy Property and Wood Residuals tax credit includes two general types of income tax credits: 1) investments in the construction, purchase or lease of "clean energy property," and 2) the

91 | P a g e

value of "wood residuals" delivered to a qualified renewable biomass

facility. The clean energy property tax credits apply to solar, wind and

energy efficiency projects, geothermal heat pumps, and certain biomass

equipment for making electricity. For the purposes of the wood

residuals tax credit, wood residuals include urban wood waste, land

clearing residues, and pellets, but not wood from a U.S. national forest.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

2

3

3

(m) Denotes a value of less than $1 million

2.6.023

Employer's Credit for Basic Skills Education

State Statute

48-7-41

Year Enacted

1991

Year Effective

1991

Data Source

DOR Data for 2010

Estimate Reliability

Class A

Data Reliability

Class A

Note

Description: A tax credit is provided to employers that sponsor or provide, at no

cost to their employees, an approved basic skills education program. A

basic skills education is one that enhances reading, writing, or

mathematical skills up to and including the twelfth grade. Employee

means any employee resident in Georgia who is employed for at least

24 hours a week and who has been continuously employed by the

employer for at least 16 consecutive weeks. Eligible expenses include

instructor salaries, materials, supplies, and textbooks but exclude costs

associated with renting or otherwise securing space.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

2.6.024

Employer's Credit for Approved Employee Retraining

State Statute

48-7-40.5

Year Enacted

1994

Year Effective

Latest modifications are effective for taxable years

beginning on or after January 1, 2009

Data Source

DOR Data for 2010

Estimate Reliability

Class B

Data Reliability

Class B

Note

This estimate differs from earlier reports due to newly

available data.

Description: The tax credit reimburses employers for the cost of providing retraining services to their employees. As of January 1, 2009, retraining programs shall not include any retraining on commercially, mass

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produced software packages for word processing, data base

management, presentations, spreadsheets, e-mail, personal information

management, or computer operating systems except a retraining tax

credit shall be allowable for those providing support or training on such

software.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

19

25

29

(m) Denotes a value of less than $1 million

2.6.025

Qualified Education Expense Credit

State Statute

48-7-29.16

Year Enacted

2008

Year Effective

Taxable years beginning on or after January 1, 2008

Data Source

DOR Data for 2010

Estimate Reliability

Class A

Data Reliability

Class A

Note

Description: This provides a tax credit for donations made by taxpayers to a

student scholarship organization which are used for tuition and fees for

a qualified school or program.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

51

52

53

(m) Denotes a value of less than $1 million

2.6.026

Qualified Investor's Tax Credit

State Statute

48-7-40.30

Year Enacted

2010

Year Effective

January 1, 2011

Data Source

Fiscal Note for HB 1001/2010 LC 18 8790

Estimate Reliability

Class A

Data Reliability

Class A

Note

Description: This credit provides a 35% tax credit for amounts invested in certain

Georgia headquartered small businesses. The credit is available for

investments made in 2011, 2012 and 2013 but the credit cannot be

claimed until FY2014 at the earliest.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

0

0

7

(m) Denotes a value of less than $1 million

2.6.027

Energy or Water Efficient Equipment Credit

State Statute

48-7-40.29

Year Enacted

2010

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Year Effective

January 1 of the year following the year in which federal

funds for this program are made available and received

by the state

Data Source

Fiscal Note for HB 1069/2010 LC 21 0586

Estimate Reliability

Class A

Data Reliability

Class A

Note

Description: This tax credit applies to taxpayers who purchase energy efficient

and water conservation equipment. The value of the credit is equal to

25 percent of the cost of the qualified equipment or $2,500, whichever

is less. The credit is only available for those tax years in which federal

funds are made available to the state for this purpose.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

0

0

0

(m) Denotes a value of less than $1 million

2.6.030

Tax credit for existing business enterprises undergoing qualified

business expansion

State Statute

48-7-40.21

Year Enacted

Year Effective

Latest modifications are applicable to tax years beginning

on or after January 1, 2008

Data Source

Estimate Reliability

Not Applicable

Data Reliability

Note

Estimate included in Provision 2.6.001

Description: This credit applies to businesses that create at least 500 new full-time

jobs within a taxable year.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

Included in 2.6.001

(m) Denotes a value of less than $1 million

Corporate income tax credits for which an estimate is not currently

available

Expenditure Statute

Summary

2.6.004 2.6.028

48-7-40.25 48-7-40.10

New Manufacturing Facilities Property Credit Tax credit for water conservation facilities and qualified water conservation investment property

2.6.029

48-7-40.11 Tax credit for shift from ground-water usage

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3. Corporate Net Worth Tax
Georgia imposes a tax on the net worth of corporations. The net worth of foreign corporations subject to the Georgia tax is based upon the ratio of assets in Georgia and gross receipts in Georgia to total assets and gross receipts. Revenues from this tax totaled $31 million in FY2011. All revenues from this tax are deposited into the state general fund.
The tax is graduated based upon the taxable net worth of the corporation. The minimum liability is $10 for corporations having $10,000 or less in taxable net worth. The maximum liability is $5,000 for corporations with taxable net worth of more than $22 million.

Corporate net worth tax expenditures for which an estimate is not currently available

Expenditure Statute

Summary

3.001

48-13-72 Exemption for nonprofit corporations

3.002

48-13-72 Exemption for insurance companies

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4. Sales and Use Tax

The sales and use tax was first enacted in Georgia in 1951 at a rate of 3 percent. The rate was increased to its current rate of 4 percent in 1989. In FY2011 the sales and use tax generated $5.1 billion and accounted for approximately 33 percent of state tax revenues. All proceeds from the sales and use tax net of the vendor commission are deposited into the state general fund.
The base consists of retail sales, leases, rentals, use on consumption of tangible personal property. In addition to the state sales tax, local governments are authorized to impose a 1 to 3 percent sales tax with a few exceptions. The local sales taxes in most counties consist of a combination of a Local Option sales tax (LOST), Special Purpose Local Option sales tax (SPLOST) and/or an Educational Special Purpose Local Option sales tax (E-SPLOST). In addition, Atlanta also levies another 1 percent sales tax to cover expenses related to sewer repairs and two counties levy a Homestead Option sales tax (HOST).
In general, these local taxes operate from the same sales tax as the state sales tax; the major exception being food for home consumption which is included in the local sales tax base, but not in the state base. The sales tax is remitted to the Department of Revenue by the retailer. The use tax is remitted by the consumer.
For purposes of this report, the base of taxation for the sales and use tax is defined to include mainly tangible personal property. For example, food for home consumption consists of tangible property that is not included in the sales tax base at the state level and is listed as a state sales tax exemption. On the other hand, all or most services are also excluded from the state and local tax base. We provide estimates of some services that are indirectly exempt from the sales tax.

4.00300

Federal retailer's excise tax if separately itemized to the consumer and Georgia

motor fuel tax imposed on the sale of motor fuel

State Statute

48-8-3(3)

Year Enacted

1951

Year Effective

1951

Data Source

U.S. Energy Information Administration

Estimate Reliability

Class C

Data Reliability

Class A

Note

Description: Federal retailer's excise tax if separately itemized to the consumer and

Georgia motor fuel tax imposed on the sale of motor fuel

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

4

4

4

Local Tax Expenditure

3

3

3

(m) Denotes a value of less than $1 million

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4.00400

Sales of transportation furnished by a county or municipal public transit system or

public transit authorities

State Statute

48-8-3(4)

Year Enacted

1968

Year Effective

1968

Data Source

MARTA Annual Report

Estimate Reliability

Class B

Data Reliability

Class A

Note

Estimate combined with 4.00500

Description: Sales by counties and municipalities arising out of their operation of

any public transit facility and sales by public transit authorities or

charges by counties, municipalities, or public transit authorities for the

transportation of passengers upon their conveyances.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

6

6

6

Local Tax Expenditure

4

4

4

(m) Denotes a value of less than $1 million

4.00500

Sales of transportation furnished by an approved and authorized urban transit system

State Statute

48-8-3(5)

Year Enacted

1970

Year Effective

1970

Data Source

MARTA Annual Report

Estimate Reliability

Class A

Data Reliability

Class A

Note

Estimate combined with 4.00400

Description: Fares and charges, except charges for charter or sightseeing service,

collected by an urban transit system for the transportation of

passengers.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

Included in 4.00400

Local Tax Expenditure

(m) Denotes a value of less than $1 million

4.00600

Sales to any Hospital Authority created by Georgia law

State Statute

48-8-3(6)

Year Enacted

1976

Year Effective

1976

Data Source

Georgia Office of Planning and Budget and IRS 990

Form Data

Estimate Reliability

Class B

Data Reliability

Class B

Note

Estimate combined with 4.00700

Description: Sales to any hospital authority created by Article of Chapter 7 of Title

31

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State Tax Expenditure Local Tax Expenditure
(m) Denotes a value of less than $1 million

State Fiscal Years ($ in Millions) 2012 2013 2014 Included in 4.00700

4.00610

Sales to any Housing Authority created by Georgia law

State Statute

48-8-3(6.1)

Year Enacted

1999

Year Effective

1999

Data Source

Georgia Department of Community Affairs and The

American Community Survey

Estimate Reliability

Class C

Data Reliability

Class A

Note

Description: Sales to any Housing Authority created by Article 1 of Chapter 3 of

Title 8, the Housing Authorities Law.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

2

2

2

Local Tax Expenditure

1

1

1

(m) Denotes a value of less than $1 million

4.00620

Sales to local government authorities created on or after January 1, 1980 for the

principal purpose of constructing, owning, or operating a coliseum and related

facilities

State Statute

48-8-3(6.2)

Year Enacted

2002

Year Effective

2002

Data Source

Georgia Department of Community Affairs

Estimate Reliability

Class B

Data Reliability

Class B

Note

Description: Sales to local government authorities created on or after January 1,

1980 for the principal purpose of constructing, owning, or operating a

coliseum and related facilities

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

Local Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

4.00630

Sales to any agricultural commission created by the Department of Agriculture

State Statute

48-8-3(6.3)

Year Enacted

2002

Year Effective

2002

Data Source

Georgia Department of Agriculture and the Georgia

98 | P a g e

Office of Planning and Budget

Estimate Reliability

Class C

Data Reliability

Class C

Note

Description: Sales to any agricultural commission created by the Department of

Agriculture

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

Local Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

4.00700

Sales of tangible personal property and services to an approved nursing home,

inpatient hospice, general hospital or mental hospital when used specifically in the

treatment function.

State Statute

48-8-3(7)

Year Enacted

1971

Year Effective

1971

Data Source

DOR Data for 2009 and IRS 990 Form Data

Estimate Reliability

Class B

Data Reliability

Class B

Note

Estimate combined with 4.00600; this estimate differs from

earlier reports due to newly available data.

Description: Sales of tangible personal property and services to an approved nursing

home, inpatient hospice, general hospital or mental hospital when used

specifically in the treatment function.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

82

85

87

Local Tax Expenditure

62

63

65

(m) Denotes a value of less than $1 million

4.00710

Sales of tangible personal property and services to a nonprofit organization whose

primary function is to provide services to persons with intellectual disabilities.

State Statute

48-8-3(7.1)

Year Enacted

2001

Year Effective

2002

Data Source

U.S. Economic Census and American Community Survey

Estimate Reliability

Class C

Data Reliability

Class A

Note

Description: Sales of tangible personal property and services to a nonprofit

organization, the primary function of which is the provision of services

to mentally retarded persons, when such organization is a tax exempt

organization under the Internal Revenue Code and obtains an exemption

determination letter from the state revenue commissioner

99 | P a g e

State Tax Expenditure Local Tax Expenditure
(m) Denotes a value of less than $1 million

State Fiscal Years ($ in Millions)

2012 2013 2014

2

2

2

1

1

1

4.00720

Sales to Georgia Society of the Daughters of the American Revolution

State Statute

48-8-3(7.2)

Year Enacted

2002

Year Effective

2002

Data Source

IRS 990 Form Data

Estimate Reliability

Class C

Data Reliability

Class C

Note

Description: Sales of tangible personal property or services to any chapter of the

Georgia State Society of the Daughters of the American Revolution

which is tax exempt under IRS Code Section 501(c)(3) and obtains an

exemption determination letter from the state revenue commissioner.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

Local Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

4.00800

Sales of tangible personal property and services to the University System of Georgia

and its educational units.

State Statute

48-8-3(8)

Year Enacted

1963

Year Effective

1963

Data Source

University System of Georgia Annual Financial Report for

2010

Estimate Reliability

Class B

Data Reliability

Class A

Note

This estimate differs from earlier reports due to newly

available data.

Description: Sales of tangible personal property and services to the University

System of Georgia and its educational units.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

29

30

31

Local Tax Expenditure

20

20

21

(m) Denotes a value of less than $1 million

4.01000

Sales of tangible personal property and services used exclusively in the educational

function of an approved private elementary or secondary school

State Statute

48-8-3(10)

Year Enacted

1968

100 | P a g e

Year Effective

1968

Data Source

The National Center for Education Statistics and the

Georgia Department of Education

Estimate Reliability

Class C

Data Reliability

Class C

Note

Description: Sales of tangible personal property and services used exclusively in the

educational function of an approved private elementary or secondary

school

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

2

2

2

Local Tax Expenditure

2

2

2

(m) Denotes a value of less than $1 million

4.01200

School lunches sold and served to pupils and employees of public schools

State Statute

48-8-3(12)

Year Enacted

1953

Year Effective

1953

Data Source

Georgia School Nutrition Association and the Georgia

Department of Education

Estimate Reliability

Class B

Data Reliability

Class B

Note

Description: School lunches sold and served to pupils and employees of public

schools

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

8

8

8

Local Tax Expenditure

6

6

6

(m) Denotes a value of less than $1 million

4.01300

School lunches sold and served to pupils and employees of approved private schools

State Statute

48-8-3(13)

Year Enacted

1967

Year Effective

1967

Data Source

Georgia School Nutrition Association and the National

Center of Education Statistics

Estimate Reliability

Class B

Data Reliability

Class B

Note

Description: School lunches sold and served to pupils and employees of approved

private schools

101 | P a g e

State Tax Expenditure Local Tax Expenditure
(m) Denotes a value of less than $1 million

State Fiscal Years ($ in Millions) 2012 2013 2014 (m) (m) (m) (m) (m) (m)

4.01400

Sales of art and other artifacts for display or exhibition to museums

State Statute

48-8-3(14)

Year Enacted

1973

Year Effective

1973

Data Source

U.S. Economic Census and IRS 990 Form Data

Estimate Reliability

Class C

Data Reliability

Class B

Note

Description: Sales of art and of anthropological, archeological, geological,

horticultural, or zoological objects or artifacts and other similar tangible

personal property to or for the use by any museum or organization

which is tax exempt under section 501(c)(3) of the Internal Revenue

Code of such tangible personal property for display or exhibition in a

museum within this state

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

Local Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

4.01500

Specific fundraising sales by any religious institution lasting no more than 30 days in

a calendar year.

State Statute

48-8-3(15)

Year Enacted

1953

Year Effective

1953

Data Source

The National Center for Charitable Statistics

Estimate Reliability

Class C

Data Reliability

Class B

Note

Description: Sales of any religious paper in this state when the paper is owned and

operated by religious institutions or denominations and no part of the

net profit from the operation of the institution or denomination inures to

the benefit of any private person. When the number of days upon which

the fundraising activity occurs does not exceed 30 in any calendar year.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

Local Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

102 | P a g e

4.01510

Sales of pipe organs or steeple bells to any church qualifying as a nonprofit

State Statute

48-8-3(15.1)

Year Enacted

2001

Year Effective

2001

Data Source

The Atlanta Chapter for The American Guild of

Organists

Estimate Reliability

Class C

Data Reliability

Class C

Note

Description: Sales of pipe organs or steeple bells to any church qualifying as a

nonprofit

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

Local Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

4.01700

Sales of fuel or consumable supplies used by ships engaged in inter-coastal or

foreign commerce

State Statute

48-8-3(17)

Year Enacted

1951

Year Effective

1951

Data Source

U.S. Energy Information Administration, U.S.

Department of Energy

Estimate Reliability

Class B

Data Reliability

Class A

Note

Description: Sales of fuel or consumable supplies used by ships engaged in inter-

coastal or foreign commerce

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

23

23

23

Local Tax Expenditure

16

16

16

(m) Denotes a value of less than $1 million

4.02000

Water delivered through water mains, lines, or pipes.

State Statute

48-8-3(20)

Year Enacted

1966

Year Effective

1966

Data Source

The Bureau of Labor Statistics Consumer Expenditure

Survey

Estimate Reliability

Class C

Data Reliability

Class C

Note

Description: The sale of water delivered to consumers through water mains, lines, or

pipes

103 | P a g e

State Tax Expenditure Local Tax Expenditure
(m) Denotes a value of less than $1 million

State Fiscal Years ($ in Millions) 2012 2013 2014
See expenditure estimate for Residential Utilities Service (4.50009)

4.02200

Professional, insurance or personal service transactions which involve sales as

inconsequential elements for which no separate charge is made

State Statute

48-8-3(22)

Year Enacted

1951

Year Effective

1951

Data Source

US Economic Census

Estimate Reliability

Class C

Data Reliability

Class C

Note

Description: Professional, insurance or personal service transactions which involve

sales as inconsequential elements for which no separate charge is

made

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

See expenditure estimate for

Local Tax Expenditure

services (4.50003, 4.50010, 4.50011)

(m) Denotes a value of less than $1 million

4.02300

Repair services when a separate charge is made to the customer

State Statute

48-8-3(23)

Year Enacted

1951

Year Effective

1951

Data Source

US Economic Census

Estimate Reliability

Class C

Data Reliability

Class C

Note

Description: Repair services when a separate charge is made to the customer.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

See expenditure estimates for

Local Tax Expenditure

Services (4.50003, 4.50010, 4.50011)

(m) Denotes a value of less than $1 million

4.02500

Sale of seed, fertilizer, fungicide, and certain other agricultural chemicals to farmers,

and feed for livestock, fish, or poultry purchased by persons engaged in animal

husbandry (expires January 1, 2013)

State Statute

48-8-3(25)

Year Enacted

1963

Year Effective

1963

Data Source

U.S. Census of Agriculture

Estimate Reliability

Class B

104 | P a g e

Data Reliability

Class A

Note

Description: Sale of seed, fertilizer, fungicide, and certain other agricultural

chemicals to farmers, and feed for livestock, fish, or poultry purchased

by persons engaged in animal husbandry (expires January 1, 2013)

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

150 80

0

Local Tax Expenditure

104 56

0

(m) Denotes a value of less than $1 million

4.02600

Sale of machinery used exclusively for irrigation of crops to persons primarily

engaged in producing farm crops for sale (expires January 1, 2013)

State Statute

48-8-3(26)

Year Enacted

2000

Year Effective

2000

Data Source

U.S. Census of Agriculture

Estimate Reliability

Class B

Data Reliability

Class A

Note

Description: Sale of machinery used exclusively for irrigation of crops to persons

primarily engaged in producing farm crops for sale (expires January 1,

2013)

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

1

(m)

0

Local Tax Expenditure

(m) (m)

0

(m) Denotes a value of less than $1 million

4.02700

Sales of sugar for use as food to honey bee producers (expires January 1, 2013)

State Statute

48-8-3(27) Reserved

Year Enacted

1964

Year Effective

1964

Data Source

U.S. Census of Agriculture

Estimate Reliability

Class B

Data Reliability

Class A

Note

Description: Sales of sugar for use as food to honey bee producers (expires January

1, 2013)

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m)

0

Local Tax Expenditure

(m) (m)

0

(m) Denotes a value of less than $1 million

105 | P a g e

4.02800

Sale of cattle, hogs, sheep, horses, poultry, or bees when sold for breeding purposes

(expires January 1, 2013)

State Statute

48-8-3(28)

Year Enacted

1964

Year Effective

1964

Data Source

U.S. Census of Agriculture

Estimate Reliability

Class B

Data Reliability

Class A

Note

Description: Sale of cattle, hogs, sheep, horses, poultry, or bees when sold for

breeding purposes (expires January 1, 2013)

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

2

1

0

Local Tax Expenditure

1

(m)

0

(m) Denotes a value of less than $1 million

4.02900

Sale of certain types of agricultural machinery (expires January 1, 2013)

State Statute

48-8-3(29)

Year Enacted

1971

Year Effective

1972

Data Source

U.S. Census of Agriculture

Estimate Reliability

Class B

Data Reliability

Class A

Note

Description: Sale of certain types of agricultural machinery (expires January 1,

2013)

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

33

17

0

Local Tax Expenditure

23

12

0

(m) Denotes a value of less than $1 million

4.02910

Off-road equipment and related attachments used exclusively in site preparation,

planting, cultivating, or harvesting of timber by persons primarily engaged in

growing or harvesting timber (expires January 1, 2013)

State Statute

48-8-3(29.1)

Year Enacted

1994

Year Effective

1994

Data Source

U.S. Census of Agriculture

Estimate Reliability

Class B

Data Reliability

Class A

Note

Description: Off-road equipment and related attachments used exclusively in site

preparation, planting, cultivating, or harvesting of timber by persons

primarily engaged in growing or harvesting timber (expires January 1,

2013)

106 | P a g e

State Tax Expenditure Local Tax Expenditure
(m) Denotes a value of less than $1 million

State Fiscal Years ($ in Millions)

2012 2013 2014

12

6

0

8

4

0

4.03000

Vehicles purchased by service-connected disabled veterans when the U.S. Dept. of

Veterans Affairs supplies a grant to purchase the specially adapted vehicle

State Statute

48-8-3(30)

Year Enacted

1972

Year Effective

1972

Data Source

The American Community Survey and Fiscal Note for

HB 259/2011 LC 5481

Estimate Reliability

Class B

Data Reliability

Class B

Note

Description: The sale of a vehicle to a service-connected disabled veteran when the

veteran received a grant from the United States Department of

Veterans Affairs to purchase and specially adapt the vehicle to the

veteran's disability

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

Local Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

4.03310

Partial sales tax exemption for jet fuel sold to or used by a qualifying airline at a

qualifying airport

State Statute

48-8-3(33.1); 48-9-3

Year Enacted

2011

Year Effective

2011

Data Source

Fiscal Note for HB 386 LC 34 3474S

Estimate Reliability

Class A

Data Reliability

Class A

Note

This estimate differs from previous versions due to new

information

Description: Partial sales tax exemption for jet fuel sold to or used by a qualifying

airline at a qualifying airport. At the local level this exemption only

applies to the special purpose local option sales tax.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

20

21

22

Local Tax Expenditure

5

5

5

107 | P a g e

4.03400

Certain machinery used in the manufacturing of tangible personal property (expires

January 1, 2013)

State Statute

48-8-3(34)

Year Enacted

1963

Year Effective

1963

Data Source

U.S. Economic Census

Estimate Reliability

Class B

Data Reliability

Class A

Note

Description: Certain machinery used in the manufacturing of tangible personal

property (expires January 1, 2013)

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

175 90

0

Local Tax Expenditure

121 62

0

(m) Denotes a value of less than $1 million

4.03410

Machinery and equipment used to handle, move, or store tangible personal property

in certain distribution facilities

State Statute

48-8-3(34.1)

Year Enacted

1994

Year Effective

1994

Data Source

2004 Economic Development Report

Estimate Reliability

Class C

Data Reliability

Class C

Note

Description: Machinery and equipment used to handle, move, or store tangible

personal property in certain distribution facilities

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

3

3

3

Local Tax Expenditure

2

2

2

(m) Denotes a value of less than $1 million

4.03420

Machinery and equipment used directly to remanufacture certain aircraft engines or

aircraft engine parts

State Statute

48-8-3(34.2)

Year Enacted

1996

Year Effective

1996

Data Source

U.S. Economic Census

Estimate Reliability

Class B

Data Reliability

Class A

Note

Description: Machinery and equipment used directly to remanufacture certain

aircraft engines or aircraft engine parts

108 | P a g e

State Tax Expenditure Local Tax Expenditure
(m) Denotes a value of less than $1 million

State Fiscal Years ($ in Millions) 2012 2013 2014 (m) (m) (m) (m) (m) (m)

4.03440

Sales of tangible personal property to or used in or for the construction of a new

alternative fuel facility primarily dedicated to the production and processing of

ethanol, biodiesel, butanol or their by-products (expired 6/30/2012)

State Statute

48-8-3(34.4)

Year Enacted

2007

Year Effective

2007

Data Source

Fiscal Note for LC 14 9734S/2007

Estimate Reliability

Class B

Data Reliability

Class B

Note

Description: Sales of tangible personal property to or used in or for the construction

of a new alternative fuel facility primarily dedicated to the production

and processing of ethanol, biodiesel, butanol or their by-products

(expired 6/30/2012)

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

2

0

0

Local Tax Expenditure

1

0

0

(m) Denotes a value of less than $1 million

4.03800

Sale of tangible personal property and fees and charges for services by the Rock

Eagle 4-H center

State Statute

48-8-3(38)

Year Enacted

1976

Year Effective

1976

Data Source

Georgia 4-H Annual Cloverleaf Report

Estimate Reliability

Class C

Data Reliability

Class C

Note

Description: Sale of tangible personal property and fees and charges for services by

the Rock Eagle 4-H center.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

Local Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

4.03900

Certain sales by a public or private school of tangible personal property, concessions,

and tickets for admission to school functions

State Statute

48-8-3(39)

Year Enacted

1994

109 | P a g e

Year Effective

1994

Data Source

Georgia Department of Education, IRS 990 Form Data,

and the National High School Athletic Association

Estimate Reliability

Class C

Data Reliability

Class C

Note

Description: Sales by any public or private school containing any combination of

grades kindergarten through 12 of tangible property, concessions, or

tickets for admission to a school event or function, provided that the net

proceeds from such sales are used solely for the benefit of such school

or its students

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

3

3

3

Local Tax Expenditure

2

2

2

(m) Denotes a value of less than $1 million

4.04000

Sale of major components or repair parts installed in military aircraft, vehicles, or

missiles

State Statute

48-8-3(40)

Year Enacted

1965

Year Effective

1965

Data Source

USASpending.gov and The U.S. Economic Census

Estimate Reliability

Class C

Data Reliability

Class B

Note

Description: Sale of major components or repair parts installed in military aircraft,

vehicles, or missiles

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

44

40

34

Local Tax Expenditure

31

27

23

(m) Denotes a value of less than $1 million

4.04100

Sale of tangible personal property and services to a nonprofit child-caring institute,

child-placing agency, or maternity home

State Statute

48-8-3(41)

Year Enacted

2004

Year Effective

2004

Data Source

U.S. Economic Census

Estimate Reliability

Class B

Data Reliability

Class B

Note

Description: Sales of tangible personal property and services to a child-caring

institution as defined in paragraph (1) of Code Section 49-5-3; a child-

placing agency as defined in paragraph (2) of Code Section 49-5-3, or

maternity home as defined in paragraph (14) of Code Section 49-5-3,

110 | P a g e

when such institution, agency, or home is engaged primarily in

providing child services and is a non-profit, tax-exempt organization

under Section 501(c)(3) of the IRS revenue code.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

1

1

1

Local Tax Expenditure

1

1

1

(m) Denotes a value of less than $1 million

4.04300

Revenues from coin-operated amusement machines for which individual permits are

required

State Statute

48-8-3(43)

Year Enacted

1992

Year Effective

1993

Data Source

U.S. Economic Census and DOR Licensing Statistics

Estimate Reliability

Class C

Data Reliability

Class B

Note

Description: Gross Revenue generated from all bona fide coin operated amusement

machines which vend or dispense music or are operated for skill,

amusement, entertainment, or pleasure.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

2

2

2

Local Tax Expenditure

1

1

1

(m) Denotes a value of less than $1 million

4.04600

Sales of tangible personal property or taxable services to nonprofit blood banks

State Statute

48-8-3(46)

Year Enacted

1980

Year Effective

1980

Data Source

U.S. Economic Census and IRS 990 Form Data

Estimate Reliability

Class C

Data Reliability

Class B

Note

Description: Sales to certain blood banks having a nonprofit status according to

Section 501(c)(3) of the IRS revenue code

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

Local Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

4.04700

Sales of drugs dispensed by prescription, prescription glasses, contact lenses, contact

lens samples and sales or use of certain controlled substances or dangerous drugs

State Statute

48-8-3(47)

Year Enacted

1984

111 | P a g e

Year Effective

1985

Data Source

State Health Expenditures from the Centers for Medicare

and Medicaid Services

Estimate Reliability

Class B

Data Reliability

Class B

Note

Estimate combined with 4.05400 and 4.07200

Description: Sales or use of: drugs that are lawfully dispensable only by prescription

for the treatment of natural persons; prescription eyeglasses and contact

lenses; prescription contact lens samples; drugs dispensable by

prescription for the treatment of natural persons without charge to

physicians, hospitals, etc. by pharmaceutical manufacturers or

distributors; drugs and durable medical equipment dispensed or

distributed without charge solely for the purposes of a clinical trial

approved by the FDA or an institutional review board

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

388 405 423

Local Tax Expenditure

268 280 292

(m) Denotes a value of less than $1 million

4.04800

Sales of crab bait to licensed commercial fishermen

State Statute

48-8-3(48)

Year Enacted

1985

Year Effective

1985

Data Source

Georgia Department of Natural Resources and the US

Economic Census

Estimate Reliability

Class C

Data Reliability

Class C

Note

Description: Sales of crab bait to licensed commercial fisherman

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

Local Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

4.04900

Liquefied gases and other fuels used in poultry or pullet houses or structures (expires

January 1, 2013)

State Statute

48-8-3(49)

Year Enacted

2000

Year Effective

2000

Data Source

U.S. Census of Agriculture

Estimate Reliability

Class B

Data Reliability

Class A

Note

Description: Liquefied gases and other fuels used in poultry or pullet houses or

structures (expires January 1, 2013)

112 | P a g e

State Tax Expenditure Local Tax Expenditure
(m) Denotes a value of less than $1 million

State Fiscal Years ($ in Millions)

2012 2013 2014

3

2

0

2

1

0

4.05000

Sales of blood measuring devices, monitoring equipment, or insulin delivery systems

used exclusively by diabetics; insulin, insulin syringes and blood glucose monitoring

strips

State Statute

48-8-3(50)

Year Enacted

1986

Year Effective

1986

Data Source

International Diabetes Foundation and the Kaiser Family

Foundation

Estimate Reliability

Class C

Data Reliability

Class C

Note

Description: Sales of blood measuring devices, monitoring equipment, or insulin

delivery systems used exclusively by diabetics; insulin, insulin syringes

and blood glucose monitoring strips.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

19

20

22

Local Tax Expenditure

13

14

15

(m) Denotes a value of less than $1 million

4.05100

Sales of oxygen when prescribed by a licensed physician

State Statute

48-8-3(51)

Year Enacted

1986

Year Effective

1986

Data Source

U.S. Economic Census

Estimate Reliability

Class C

Data Reliability

Class A

Note

Description: Sales of oxygen when prescribed by a licensed physician

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

5

5

5

Local Tax Expenditure

3

3

4

(m) Denotes a value of less than $1 million

4.05200

Sale or use of hearing aids

State Statute

48-8-3(52)

Year Enacted

1986

Year Effective

1986

Data Source

Fiscal Note for LC 25 4850/2007 and the Kaiser

Foundation

113 | P a g e

Estimate Reliability

Class A

Data Reliability

Class B

Note

Description: Exempts the sale of approved hearing aids from sales and use tax.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

4

4

4

Local Tax Expenditure

3

3

3

(m) Denotes a value of less than $1 million

4.05300

Transactions where food stamps or WIC coupons are used as the method of payment

State Statute

48-8-3(53)

Year Enacted

1986

Year Effective

1987

Data Source

U.S. Food and Nutrition Service and the U.S. Department

of Agriculture

Estimate Reliability

Class B

Data Reliability

Class A

Note

Description: Sales tax is not applied on items purchased using food stamps or WIC

coupons.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

123 117 111

Local Tax Expenditure

92

88

83

(m) Denotes a value of less than $1 million

4.05400

Sale or use of any durable medical equipment or prosthetic device prescribed by a

physician

State Statute

48-8-3(54)

Year Enacted

1992

Year Effective

1993

Data Source

U.S. Census of National Health Expenditures

Estimate Reliability

Class B

Data Reliability

Class A

Note

Included in 4.04700

Description: Sale or use of any durable medical equipment or prosthetic device

prescribed by a physician

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

Included in 4.04700

Local Tax Expenditure

(m) Denotes a value of less than $1 million

4.05500 Sale of Georgia lottery tickets

State Statute

48-8-3(55)

Year Enacted

1992

114 | P a g e

Year Effective

1992

Data Source

Georgia Lottery Commission Annual Report

Estimate Reliability

Class A

Data Reliability

Class A

Note

Description: Sale of lottery tickets authorized by Chapter 27 of Title 50

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

160 165 171

Local Tax Expenditure

110 114 118

(m) Denotes a value of less than $1 million

4.05600

Sales by any qualified nonprofit parent teacher organization

State Statute

48-8-3(56)

Year Enacted

1995

Year Effective

1995

Data Source

Georgia Parent Teacher Association and IRS 990 Form

data

Estimate Reliability

Class C

Data Reliability

Class B

Note

Description: Sales by any qualified nonprofit parent teacher organization

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

Local Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

4.05700

Food purchased for off premises consumption

State Statute

48-8-3(57)

Year Enacted

1996

Year Effective

1998

Data Source

U.S. Consumer Expenditure Survey

Estimate Reliability

Class B

Data Reliability

Class B

Note

Description: Exemption applies to food items consumed at home, including meat,

poultry, bread, milk, candy, canned soft drinks. It does not apply to

alcoholic beverages, tobacco, immediate consumption items, vitamins,

minerals, and items sold from vending machines. This exemption does

not apply to the local option sales tax but does not apply to special

purpose and educational option sales taxes levied at the local level.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

432 472 509

Local Tax Expenditure

(m) Denotes a value of less than $1 million

115 | P a g e

4.05900

Sales of eligible food and beverages for on or off-premises consumption by any Girl

or Boy Scout council

State Statute

48-8-3(59)

Year Enacted

1996

Year Effective

1996

Data Source

The American Community Survey, IRS 990 Form data,

and Girl Scouts of America Annual Report

Estimate Reliability

Class B

Data Reliability

Class B

Note

Description: Sales of food or food ingredients to and by member councils of the Girl

Scouts or Boy Scouts of America

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

1

1

1

Local Tax Expenditure

1

1

1

(m) Denotes a value of less than $1 million

4.06200

Sod grass sold in the original state of production by the sod producer, employee of

the producer, or family member of the producer

State Statute

48-8-3(62)

Year Enacted

1998

Year Effective

1998

Data Source

U.S. Census of Agriculture and the U.S. Economic

Census

Estimate Reliability

Class B

Data Reliability

Class A

Note

Description: Sod grass sold in the original state of production by the sod producer,

employee of the producer, or family member of the producer

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

4

4

4

Local Tax Expenditure

3

3

3

(m) Denotes a value of less than $1 million

4.06300

Funeral merchandise when paid with funds from the Georgia Crime Victims'

Emergency fund

State Statute

48-8-3(63)

Year Enacted

1998

Year Effective

1998

Data Source

The Uniform Crime Report and the National Office for

Victims of Crime

Estimate Reliability

Class C

Data Reliability

Class C

Note

116 | P a g e

Description: The sale or use of funeral merchandise, outer burial containers, and

cemetery markers as defined in Code Section 43-18-1, which are

purchased with funds received from the Georgia Crime Victims

Emergency Fund under Chapter 15 of Title 17

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

Local Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

4.06400

Sales of electricity or fuels used exclusively for the operation of an irrigation system

on a farm for crop irrigation (expires January 1, 2013)

State Statute

48-8-3(64)

Year Enacted

2000

Year Effective

2000

Data Source

U.S. Census of Agriculture

Estimate Reliability

Class B

Data Reliability

Class A

Note

Description: Sales of electricity or fuels used exclusively for the operation of an

irrigation system on a farm for crop irrigation (expires January 1,

2013)

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

20

15

0

Local Tax Expenditure

14

7

0

(m) Denotes a value of less than $1 million

4.06500

Sales of dyed diesel fuel used exclusively for operations of vessels or boats by

licensed commercial fishermen

State Statute

48-8-3(65)

Year Enacted

NA

Year Effective

NA

Data Source

The Georgia Department of Natural Resources and the

U.S. Economic Census

Estimate Reliability

Class C

Data Reliability

Class C

Note

Description: Sales of dyed diesel fuel used exclusively for operations of vessels or

boats by licensed commercial fishermen.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

Local Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

117 | P a g e

4.07000

Sales of natural gas used directly in the manufacture of electricity

State Statute

48-8-3(70)

Year Enacted

1999

Year Effective

2000

Data Source

U.S. Energy Information Administration

Estimate Reliability

Class B

Data Reliability

Class A

Note

Description: Sales of natural gas used directly in the manufacture of electricity which

is subsequently sold

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

37

36

36

Local Tax Expenditure

25

25

25

(m) Denotes a value of less than $1 million

4.07100

Sales to or by an organization whose primary purpose is to raise funds for books,

materials, and programs for public libraries

State Statute

48-8-3(71)

Year Enacted

1999

Year Effective

2000

Data Source

National Center for Charitable Statistics

Estimate Reliability

Class B

Data Reliability

Class B

Note

Description: Sales to or by an organization whose primary purpose is to raise funds

for books, materials, and programs for public libraries

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

Local Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

4.07200

Sales of wheelchairs and attachments for wheelchairs when sold to permanently

disabled individuals

State Statute

48-8-3(72)

Year Enacted

1999

Year Effective

2000

Data Source

The Bureau of Labor Statistics Consumer Expenditure

Survey

Estimate Reliability

Class B

Data Reliability

Class B

Note

Description: Sales of wheelchairs and attachments for wheelchairs when sold to

permanently disabled individuals

118 | P a g e

State Tax Expenditure Local Tax Expenditure
(m) Denotes a value of less than $1 million

State Fiscal Years ($ in Millions) 2012 2013 2014 Included in 4.04700

4.07300

Sales of certain production equipment to film producers and film production

companies (expires January 1, 2013)

State Statute

48-8-3(73)

Year Enacted

2001

Year Effective

2002

Data Source

DOR Data for 2009

Estimate Reliability

Class B

Data Reliability

Class A

Note

Description: Sales of certain production equipment to film producers and film

production companies (expires January 1, 2013)

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

10

5

0

Local Tax Expenditure

7

4

0

(m) Denotes a value of less than $1 million

4.07500

Sales tax holiday for back to school items (expires August 10, 2013)

State Statute

48-8-3(75)

Year Enacted

2012

Year Effective

2013

Data Source

Fiscal Note for HB 1053 LC 34 3342

Estimate Reliability

Class A

Data Reliability

NA

Note

Sales tax holidays for school supplies have been utilized

beginning in 2002

Description: Commencing at 12:01 A.M. on August 10, 2012, and concluding at

12:00 Midnight on August 11, 2012; and Commencing at 12:01 A.M.

on August 9, 2013, and concluding at 12:00 Midnight on August 10,

2013. The sale of articles of clothing and footwear; the single purchase

of certain personal computers including non-recreational software; and

purchases of general school supplies to be utilized in the classroom.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

0

39

41

Local Tax Expenditure

0

27

29

(m) Denotes a value of less than $1 million

119 | P a g e

4.07700

Liquefied gases and other fuels used in structures where plants, floral products,

seedlings, and nursery stock are grown for sale (expires January 1, 2013)

State Statute

48-8-3(77)

Year Enacted

2003

Year Effective

2003

Data Source

US Census of Agriculture

Estimate Reliability

Class A

Data Reliability

Class A

Note

Description: Liquefied gases and other fuels used in structures where plants, floral

products, seedlings, and nursery stock are grown for sale (expires

January 1, 2013)

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

1

(m)

0

Local Tax Expenditure

(m) (m)

0

(m) Denotes a value of less than $1 million

4.07800

Materials used to construct a new symphony hall costing in excess of $200 million

that is owned and operated by a nonprofit organization (expired 9/1/2011)

State Statute

48-8-3(78)

Year Enacted

2004

Year Effective

2004

Data Source

Fiscal Note for HB 395/2009 LC 28 4533

Estimate Reliability

Class A

Data Reliability

Class A

Note

This project has been put on hold due to recent economic

conditions.

Description: From May 5, 2004 until September 1, 2011, sales of tangible personal

property used in direct connection with the construction of a new

symphony hall facility owned or operated by an organization which is

exempt from taxation under Section 501 (c)(3) of the Internal Revenue

Code

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

0

0

0

Local Tax Expenditure

0

0

0

(m) Denotes a value of less than $1 million

4.08100

The purchase of food and nonalcoholic beverages provided at no charge aboard a

qualified airline

State Statute

48-8-3(81)

Year Enacted

2005

Year Effective

2005

Data Source

Bureau of Transportation Statistics and the Air Transport

Association

Estimate Reliability

Class B

120 | P a g e

Data Reliability

Class B

Note

Description: The purchase of food and nonalcoholic beverages provided at no charge

aboard a qualified airline not including alcohol or tobacco

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

5

4

4

Local Tax Expenditure

3

3

3

(m) Denotes a value of less than $1 million

4.08200

Sales tax holiday for water and energy efficient purchases (expires October 6, 2013)

State Statute

48-8-3(82)

Year Enacted

2012

Year Effective

2013

Data Source

Fiscal Note for HB 1053 LC 34 3342

Estimate Reliability

Class B

Data Reliability

Class B

Note

Sales tax holidays for energy efficient products have

been utilized beginning in 2005

Description: Commencing at 12:01 A.M. on October 5, 2012, and concluding at

12:00 Midnight on October 7, 2012; and Commencing at 12:01 A.M. on

October 4, 2013, and concluding at 12:00 Midnight on October 6, 2013.

Purchase of energy efficient products or water efficient products with a

sales price of $1,500.00 or less per product purchased for

noncommercial home or personal use.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

0

(m) (m)

Local Tax Expenditure

0

(m) (m)

(m) Denotes a value of less than $1 million

4.08300

Sale of biomass materials used to produce electricity or steam or used to produce

electricity and steam intended for sale

State Statute

48-8-3(83)

Year Enacted

2006

Year Effective

2006

Data Source

Fiscal Note for HB 1018/2009 LC 18 4936 and the U.S.

Energy Information Administration

Estimate Reliability

Class B

Data Reliability

Class A

Note

Description: The sale or use of biomass material, including pellets or other fuels

derived from compressed, chipped, or shredded biomass material,

utilized in the production of energy, including without limitation, the

production of electricity and/or steam.

121 | P a g e

State Tax Expenditure Local Tax Expenditure
(m) Denotes a value of less than $1 million

State Fiscal Years ($ in Millions) 2012 2013 2014 (m) (m) (m) (m) (m) (m)

4.08600

Sales of engines, parts, equipment and other tangible personal property used in the

maintenance or repair of certain aircraft (expires 6/30/2013)

State Statute

48-8-3(86)

Year Enacted

2009

Year Effective

2009

Data Source

Fiscal Note for HB 116/2009 LC 18 7776

Estimate Reliability

Class C

Data Reliability

Class C

Note

Exemption extended from 2011 to 2013 in 2011

Description: For the period commencing on July 1, 2007 and ending on June 30,

2013, the sale or use of engines, parts, equipment, and other tangible

personal property used in the maintenance or repair of aircraft when

such engines, parts, equipment, and other tangible personal property are

installed on such aircraft that is being repaired or maintained in this

state so long as such aircraft is not registered in this state

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

7

7

0

Local Tax Expenditure

5

5

0

(m) Denotes a value of less than $1 million

4.08800

Sales of tangible personal property used in the construction of a qualified civil rights

museum (expires 7/30/2015)

State Statute

48-8-3(88)

Year Enacted

2009

Year Effective

2009

Data Source

Fiscal Note for HB 364/2009 LC 18 7942

Estimate Reliability

Class A

Data Reliability

Class A

Description: Sales of tangible personal property used in the construction of a

qualified civil rights museum (expires 7/30/2015)

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(1)

(1)

(1)

Local Tax Expenditure

(1)

(1)

(1)

(m) Denotes a value of less than $1 million

122 | P a g e

4.5 Sales and Use Tax for Services

4.50000 Admissions and Amusements

Description: Admission to school and college sports events; rental of films and tapes by

theaters; cable tv and direct satellite tv; coin operated video games

(includes pinball and other mechanical amusements); membership fees in

private clubs; overnight trailer parks.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

102 104 109

Local Tax Expenditure

76

79

82

(m) Denotes a value of less than $1 million

4.50001 Agricultural Services

Description: Veterinary services (both large and small animal); landscaping services

(including lawn care); pet grooming

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

106 109 114

Local Tax Expenditure

79

82

86

(m) Denotes a value of less than $1 million

4.50002 Automotive Services

Description: Automotive road service and towing services; automotive painting and

lube; parking lots and garages; automotive washing and waxing;

automotive rustproofing and undercoating; labor charges on repairs to

motor vehicles

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

83

85

89

Local Tax Expenditure

62

64

67

(m) Denotes a value of less than $1 million

4.50003 Business Services Description: Billboards; test laboratories (excluding medical); interior design and decorating; commercial art and graphic design; advertising agency fees (not ad placement) sign construction and installation; employment agencies; temporary help agencies; check and debt collection; credit information and credit bureaus; exterminating (includes termite services); maintenance and janitorial services; window cleaning; bail bond fees; telephone answering service; telemarketing services on contract; secretarial and court reporting services; security services (includes private investigation (detective) services; armored car services

123 | P a g e

State Tax Expenditure Local Tax Expenditure
(m) Denotes a value of less than $1 million

State Fiscal Years ($ in Millions) 2012 2013 2014 493 506 530 369 379 398

4.50004 Computer and Online Services

Description: Online data processing services; downloaded software, books, music,

movies and video content, other electronic goods; internet service

providers dial-up; internet service providers DSL or other broadband;

mainframe computer access and processing service; information services;

software custom programs and professional services

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

202 207 217

Local Tax Expenditure

152 156 163

(m) Denotes a value of less than $1 million

4.50005 Construction Labor

Description: Labor for the construction of buildings; heavy and civil engineering

construction labor; labor of specialty trade contractors

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

1,542 1,584 1,660

Local Tax Expenditure

1,157 1,188 1,245

(m) Denotes a value of less than $1 million

4.50006 Fabrication, Installation, and Repair Services

Description: Labor charges for repairs for other tangible property; labor charges on

tv/radio repairs and other electronic equipment; repair charges generally;

labor charges on repair of aircraft; labor charges on repairs to interstate

vessels; labor charges on repairs to intrastate vessels; labor charges on

repairs to railroad rolling stock; labor charges for repairs or remodeling of

real property; service contracts sold at the time of sale of tangible personal

property; installation charges by persons selling property; installation

charges by persons other than the seller of the property

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

167 171 179

Local Tax Expenditure

125 128 134

(m) Denotes a value of less than $1 million

4.50007 Finance, Insurance, and Real Estate Description: Service charges of banking institutions includes loan broker fees; insurance services; property sales agents (real estate or personal); real estate management fees (rental agents); investment counseling; real estate title abstract services

124 | P a g e

State Tax Expenditure Local Tax Expenditure
(m) Denotes a value of less than $1 million

State Fiscal Years ($ in Millions) 2012 2013 2014 355 364 382 266 273 286

4.50008 Industrial and Mining Services

Description: Seismograph and geophysical services; metal and nonmetal and coal

mining services; typesetting services; platemaking for the print trade

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

7

7

7

Local Tax Expenditure

5

5

6

(m) Denotes a value of less than $1 million

4.50009 Residential Utility Service

Description: Interstate telephone (including local, long distance, and cellular service)

and telegraph; water; sewer and refuse

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

106 108 113

Local Tax Expenditure

79

81

85

(m) Denotes a value of less than $1 million

4.50010 Personal Services

Description: Carpet and upholstery cleaning; swimming pool cleaning and

maintenance; water softening and conditioning; shoe repair; garment services

(altering and repairing); health clubs, tanning parlors, and reducing salons;

laundry and dry cleaning services coin operated; laundry and dry cleaning

services not coin operated; massage services (includes dating services);

tax return preparation; sports and recreation instruction; barber shops;

beauty parlors; travel agent services

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

153 157 165

Local Tax Expenditure

115 118 124

(m) Denotes a value of less than $1 million

4.50011 Professional Services

Description: Attorneys; accounting and bookkeeping; physicians; dentists; medical test

laboratories; architects; engineers; land surveying; nursing services out of

the hospital

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

1,218 1,251 1,311

Local Tax Expenditure

914 938 983

(m) Denotes a value of less than $1 million

125 | P a g e

4.50012 Storage

Description: Marine towing services (includes tugboats); household goods storage; cold

storage (includes fur storage); food storage; mini-storage; marina service

(docking, storage, cleaning, repair); packing and crating (include bus

services); other warehousing and storage (including automotive storage)

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

46

48

50

Local Tax Expenditure

35

36

37

(m) Denotes a value of less than $1 million

4.50013 Transportation Services Description: Intrastate courier service
State Tax Expenditure Local Tax Expenditure
(m) Denotes a value of less than $1 million

State Fiscal Years ($ in Millions) 2012 2013 2014 (m) (m) (m) (m) (m) (m)

126 | P a g e

4.7 Vendor Compensation

4.70000

Compensation of dealers for reporting and paying tax

State Statute

48-8-50

Year Enacted

1964

Year Effective

1964

Data Source

DOR Statistical Report for 2009

Estimate Reliability

Class A

Data Reliability

Class A

Note

Description: Georgia allows a vendor collection fee of 3 percent for the first $3,000

and then 0.5 percent for amounts above $3,000 but does not impose a

maximum limitation per vendor.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

53

56

58

Local Tax Expenditure

(m) Denotes a value of less than $1 million

4.9 Casual Sales

4.90000

Sales tax exemption for casual sales

State Statute

Department of Revenue administrative rule

Year Enacted

Not available at this time

Year Effective

Not available at this time

Data Source

DOR Data for 2009

Estimate Reliability

Class B

Data Reliability

Class A

Note

Sales of all motor vehicle will be exempt from state and

local sales tax beginning March 1st, 2013.Provision listed

as 4.30000 in previous reports.

Description: Purchases of motor vehicles, boats, planes and other tangible goods

sold by persons not in the business of selling such items are not subject

to sales tax.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

151 125

2

Local Tax Expenditure

105 87

1

(m) Denotes a value of less than $1 million

127 | P a g e

Sales and use tax expenditures for which an estimate is not currently available

Expenditure Statute

Summary

4.00100 4.00200
4.00900
4.01100 4.01600 4.01800 4.01900
4.02100
4.02400 4.03100 4.03200 4.03300

48-8-3(1) 48-8-3(2)
48-8-3(9)
48-8-3(11) 48-8-3(16) 48-8-3(18) 48-8-3(19)
48-8-3(21)
48-8-3(24) 48-8-3(31) 48-8-3(32) 48-8-3(33)

Sales to Federal Government, State of Georgia or a county or municipality in Georgia or any agency of such governments Tangible personal property furnished by the Federal Government or any county or municipality used by a contractor in the installation, repair, or extension of any public water, gas, or sewer system. Sales of tangible personal property and services used exclusively in the educational function of an approved private college or university located in Georgia whose credits are accepted by the University System of Georgia. Sales of tangible personal property or services to, and the purchase of tangible personal property or services by, any educational or cultural institute The sale or use of Holy Bibles; testaments, and similar books commonly recognized as being Holy Scripture regardless of by or to whom sold Charges for transportation of tangible personal property made in connection with interstate or intrastate transportation All tangible personal property purchased outside this state by a nonresident when the property is brought into Georgia upon the nonresident becoming a resident Sales, transfers or exchanges of tangible personal property resulting from business reorganization when the owners, partners, or stockholders maintain the same proportionate interest or share in the newly formed business Rental of videotape or film to persons charging admission to view the tape or film Sale of tangible personal property manufactured or assembled in Georgia for export when delivery is taken outside of Georgia Aircraft, watercraft, motor vehicles, and other transportation equipment manufactured or assembled in this State for exclusive use outside Georgia Common or Common and Contract Carriers

4.03430 4.03500

48-8-3(34.3) 48-8-3(35)

The sale or use of repair or replacement parts, machinery clothing, molds, dies, waxes or tooling for machinery (expires January 1, 2013) Certain materials used in industrial packaging (expires January 1, 2013)

4.03600 4.03610 4.03700
4.03910 4.04200
4.04400 4.04500 4.06000 4.06100

48-8-3(36) 48-8-3(36.1) 48-8-3(37)
48-8-3(39.1) 48-8-3(42)
48-8-3(44) 48-8-3(45) 48-8-3(60) 48-8-3(61)

Machinery and equipment used in a facility for the primary purpose of reducing or eliminating air and water pollution Machinery and equipment used for water conservation and incorporated into a qualified water conservation facility. Machinery and equipment used in combating air and water pollution and any industrial material used in a burning or recycling process (expiring January 1, 2013) Cargo containers and related chassis used for storage or shipping by persons engaged in international shipment of tangible personal property Use or lease of tangible personal property when the lessor and lessee are under 100 percent common ownership and where the person who furnishes, leases, or rents the property has paid sales or use tax on the property Sales of motor vehicles to nonresident purchasers when vehicles are immediately removed from Georgia and titled in another state. The sale or use of paper stock when used to print catalogs for distribution outside Georgia. Sales of machinery and equipment and material incorporated and used in a clean room of Class 100,000 or less Advertising inserts that are used in newspapers for resale

4.06600

48-8-3(66)

Sales of gold, silver, or platinum bullion

128 | P a g e

Sales and use tax expenditures for which an estimate is not currently available

Expenditure Statute

Summary

4.06700

48-8-3(67)

Sales of coins or currency

4.06800 4.06900 4.07900 4.09000 4.09100 4.09200
4.09300
4.09400 4.3.20000 4.3.30000

48-8-3(68) 48-8-3(69) 48-8-3(79) 48-8-3(90) 48-8-3(91) 48-8-3(92)
48-8-3(93)
48-8-3(94) 48-8-3.2 48-8-3.3

Sales of certain computer equipment when the total qualifying purchases by a high technology company exceed $15 million Sales of machinery and equipment and material incorporated and used in a clean room of Class 100 or less Ice used to chill poultry or vegetables during processing or shipment (expires January 1, 2013) The sale of electricity to a manufacturer located in this state used directly in the manufacture of a product (expires January 1, 2013) The sale of prewritten software which has been delivered to the purchaser electronically or by means of load and leave. Sales to an organization defined by the Internal Revenue Service as an instrumentality of the states relating to the holding of an annual meeting in this state for the period commencing July 1, 2012, and ending on December 31, 2013. Sales of tangible personal property used for and in the construction of a competitive project of regional significance, for the period commencing January 1, 2012, until June 30, 2014. The sale, use, consumption, or storage of materials, containers, labels, sacks, or bags used for packaging tangible personal property for shipment or sale. Exemptions for energy, machinery or equipment, industrial material, and consumable supplies used in manufacturing Sales and use by a qualified agriculture producer of agricultural production inputs, energy used in agriculture, and agricultural machinery and equipment

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5. Insurance Premium Tax
The premium tax is levied on premiums of persons, property or risks in Georgia written by insurance companies conducting business in Georgia. The state tax rate is imposed at a rate of 2.25 percent of gross direct premiums. In FY2011, revenues from this tax equaled $361 million. This tax is administered by the state Insurance Commissioner. The proceeds of the tax are deposited into the state general fund.

5.00100

Deduction of retaliatory taxes paid to other states

State Statute

33-8-7

Year Enacted

1960

Year Effective

Prior to 2000

Data Source

Office of Insurance and Safety Fire Commissioner

Estimate Reliability

Class A

Data Reliability

Class A

Note

Description: Property and casualty insurance companies domiciled in Georgia are

able to deduct taxes paid to other states on policies written in those

states from their Georgia tax liability.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

2

2

2

(m) Denotes a value of less than $1 million

5.00200

Insurance premium tax credits

State Statute

33-8-4.1; 33-1-18; 48-7-29.14(b)(1)

Year Enacted

1960

Year Effective

2009, 2002, 2008

Data Source

Office of Insurance and Safety Fire Commissioner

Estimate Reliability

Class A

Data Reliability

Class A

Note

Description: Insurance companies are allowed a credit against the premium tax.

These credits include the Jobs tax credit, the Low-Income Housing

credit, and the Clean Energy credit. For a description of these credits,

see section 2.6 on corporate income tax credits of this report.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

77

79

81

(m) Denotes a value of less than $1 million

5.00300

Exemption for premiums of high deductible health plans

State Statute

33-8-4

Year Enacted

2008

Year Effective

2009

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Data Source

Office of Insurance and Safety Fire Commissioner

Estimate Reliability

Class A

Data Reliability

Class A

Note

Description: Insurance companies are allowed to exempt from insurance premium

tax any premiums paid by Georgia residents for high deductible health

plans as defined by Section 233 of the Internal Revenue Code.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

1

1

1

(m) Denotes a value of less than $1 million

5.00400

Exemption for insurance companies that only insure places of worship

State Statute

33-8-13

Year Enacted

1996

Year Effective

1996

Data Source

Office of Insurance and Safety Fire Commissioner

Estimate Reliability

Class A

Data Reliability

Class A

Note

Description: Insurance companies that only insure the risks of places of worship

are exempt from the state premium tax.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

5.00500

Insurance abatements

State Statute

33-8-5

Year Enacted

1996

Year Effective

Prior to 2000

Data Source

Office of Insurance and Safety Fire Commissioner

Estimate Reliability

Class A

Data Reliability

Class A

Note

Description: Georgia imposes a reduced state rate of 1.25 percent on insurance

companies that invest at least 25 percent of their assets in qualified

Georgia assets. If the amount invested in qualified Georgia assets was

greater than 75 percent, the rate is reduced to 0.50 percent.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

133 137 141

(m) Denotes a value of less than $1 million

131 | P a g e

5.00600

Special deductions for life insurance companies

State Statute

33-8-4, 33-8-8, 33-8-8.1

Year Enacted

1981

Year Effective

Prior to 2000

Data Source

Office of Insurance and Safety Fire Commissioner

Estimate Reliability

Class A

Data Reliability

Class A

Note

Description: Life insurance companies are permitted to deduct contributions to

state guarantee funds, license fees paid to local governments, local

premium taxes from premium taxes otherwise payable to the state.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

114 118 120

(m) Denotes a value of less than $1 million

132 | P a g e

6. Motor Fuel Tax

The tax on motor fuels consists of two taxes. The first tax is levied at a rate of 7 cents per gallon of motor fuel. The second tax is a 3 percent tax on the retail sales price of motor fuel. This tax is commonly referred to as the "second motor fuel tax." Revenues generated by the first and second motor fuel tax are allocated to the Department of Transportation. Revenues from a one percent sales tax on the retail price of motor fuel are deposited into the state general fund.

The base of the motor fuel tax is imposed on any source of energy that can be used for propulsion of a motor vehicle on the public highways, including, but not limited to: gasoline, fuel oils, compressed petroleum gas and special fuels.

The tax is administered by the Department of Revenue. In FY2011 proceeds from the combined motor fuel tax equaled $933 million.

6.00100

Motor fuel tax refunds for agricultural purposes

State Statute

48-9-10

Year Enacted

1978

Year Effective

1978

Data Source

DOR Statistical Report for 2010

Estimate Reliability

Class A

Data Reliability

Class A

Note

Last modification in 2010

Description: Motor Fuel Tax refunds for agricultural purposes.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

20

20

20

(m) Denotes a value of less than $1 million

6.00200

Sales to mass transit vehicles

State Statute

48-9-3

Year Enacted

1978

Year Effective

Latest modification 2010

Data Source

Energy Information Administration and the U.S.

Department of Energy

Estimate Reliability

Class B

Data Reliability

Class A

Note

Estimate combined with 6.00300

Description: Fuel sold for use in vehicles operated by a public campus transportation

system or fuel sold for use in public mass transit vehicles is exempt

from tax. This provision expires 6/30/2015

133 | P a g e

State Tax Expenditure
(m) Denotes a value of less than $1 million

State Fiscal Years ($ in Millions)

2012 2013 2014

3

3

3

6.00300

Sales to campus transportation vehicles

State Statute

48-9-3

Year Enacted

2010

Year Effective

2010

Data Source

Estimate included in 6.00200

Estimate Reliability

Class B

Data Reliability

Class A

Note

Description: Sales to campus transportation vehicles

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

Included in 6.00200

(m) Denotes a value of less than $1 million

6.00400

Motor fuel tax exemption for aviation fuel

State Statute

48-9-3

Year Enacted

1978

Year Effective

1978

Data Source

DOR Statistical Report for 2010

Estimate Reliability

Class A

Data Reliability

Class A

Note

Description: Exemption for aviation fuel

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

6.00500

Motor fuel tax vendor compensation

State Statute

48-9-3,14

Year Enacted

1992

Year Effective

1992

Data Source

DOR Statistical Report for 2010

Estimate Reliability

Class A

Data Reliability

Class A

Note

Description: Motor fuel dealers are allowed to retain 3% of total amounts collected

as reimbursement for the cost of collection.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

5

5

5

(m) Denotes a value of less than $1 million

134 | P a g e

7. Alcoholic Beverage Tax

This tax is imposed on alcoholic beverages including malt beverages, wine, and distilled spirits. Malt beverages are taxed at a rate of $10 per container up to 31 gallons with a proportionate tax on fractional parts of 31 gallons for draft malt beverages. The tax rate is 4 cents per 12 ounces for bottles and cans with proportionate rates on fractional parts of other sizes. Wine is taxed at a rate of 11 cents per liter and an import tax of 29 cents per liter is imposed on table wines with proportional rates for fractional parts of a liter. An excise tax of 27 cents per liter with an import tax of 40 cents per liter is imposed on dessert wines with proportional rates for fractional parts of a liter. An excise tax of 50 cents per liter and an import tax of 70 cents per liter are levied on distilled spirits.

The tax is administered by the Department of Revenue. All taxes on alcoholic beverages totaled $162 million in FY2011. The proceeds of the tax are deposited into the state general fund.

7.00300

Up to 200 gallons annually of home-brew per household

State Statute

3-5-61, 3-6-70

Year Enacted

1977

Year Effective

1977

Data Source

American Association of Homebrewers and Brew Your

Own Magazine

Estimate Reliability

Class B

Data Reliability

Class C

Note

Description: Up to 200 gallons annually of home-brew per household

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

7.00400

Sales to and use by religious organizations for sacramental

purposes

State Statute

3-5-61, 3-6-70

Year Enacted

1977

Year Effective

1977

Data Source

National Center for Charitable Statistics and Catholic.org

Estimate Reliability

Class B

Data Reliability

Class C

Note

Description: Sales to and use by religious organizations for sacramental purposes

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

135 | P a g e

7.00500

Exemption for ethyl alcohol used for certain purposes

State Statute

3-5-61, 3-6-70

Year Enacted

1980

Year Effective

1980

Data Source

U.S. Economic Census

Estimate Reliability

Class B

Data Reliability

Class A

Note

Description: This chapter shall not apply to ethyl alcohol intended for use or used for

the following purposes: scientific, chemical, mechanical, industrial,

medicinal, and culinary.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

7.00600

Malt beverages containing less than one-half of 1 percent alcohol

by volume

State Statute

3-5-90

Year Enacted

1987

Year Effective

1987

Data Source

U.S. Economic Census and Averagebeerprices.com

Estimate Reliability

Class B

Data Reliability

Class B

Note

Description: Malt beverages which contain less than one-half of 1 percent alcohol by

volume shall not be subject to any tax levied under this title or any tax

levied pursuant to authority granted by this title.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

Alcoholic beverages tax expenditures for which an estimate is not currently

available

Expenditure Statute

Summary

7.00100

3-5-61

Sales to persons outside the state for resale or consumption outside the state

7.00200

3-5-61, 3-6-70 Sales to stores or canteens on U.S. military reservations

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8. Cigar and Cigarette Excise Tax

The tax is levied upon the sale, receipt, purchase, possession, consumption, handling, distribution, or use of cigars and cigarettes in Georgia.

The tax is imposed at a rate of 37 cents per pack of 20 cigarettes and pro rata for other sized packages. Little cigars, weighing not more than 3 pounds per thousand are taxed at a rate of two and one-half mills each ($2.50 per 1000). All other cigars are taxed at 23 percent of the wholesale cost price, exclusive of any trade, cash, of other discounts or any promotion, advertising, display or other similar allowances. Loose or smokeless tobacco is taxed at a rate of 10 percent of the wholesale cost price.

The tax is administered by the Department of Revenue. In FY2011 the tax totaled $229 million. The proceeds of the tax are deposited into the state general fund.

8.00100

Exemption for purchases for use exclusively by patients at the Georgia War

Veterans Home and the Georgia War Veterans Nursing Home

State Statute

48-11-2

Year Enacted

1955

Year Effective

Latest Modification 2003

Data Source

Georgia Department of Veteran Services

Estimate Reliability

Class B

Data Reliability

Class C

Note

Description: Exemption for purchases for use exclusively by patients at the Georgia

War Veterans Home and the Georgia War Veterans Nursing Home

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

(m) (m) (m)

(m) Denotes a value of less than $1 million

Cigar and cigarette excise tax expenditures for which an estimate is not

Expenditure Statute

currently available
Summary

8.00200

48-11-3 Di minimus amount brought into the state by one person

8.00300

48-11-3 Cigars and cigarettes stored in a public warehouse

8.00400

48-11-3 Certain cigars and cigarettes held by licensed dealers

137 | P a g e

9. Financial Institutions Special State Occupation Tax
This is a special state occupation tax imposed on the adjusted gross receipts of each depository financial institution that does business or owns property in the state. The state tax rate is levied at a rate of 0.25 percent. In addition to the state tax, counties and municipalities may levy a rate not to exceed 0.25 percent of gross receipts. Any amount paid under the special state occupation tax by a financial institution reduces the institution's state income tax liability by an equal amount.
The tax is administered by the Department of Revenue. The revenues from this tax in FY2011 equaled $27 million. The proceeds of the tax are deposited into the state general fund.

9.00100

Deduction for interest paid

State Statute

48-6-95

Year Enacted

1975

Year Effective

1975

Data Source

FDIC Statistics on Depository Institutions

Estimate Reliability

Class B

Data Reliability

Class A

Note

Description: Financial institutions are allowed to deduct from gross receipts interest

paid on all liabilities

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

3

3

3

(m) Denotes a value of less than $1 million

Financial institutions tax expenditures for which an estimate is not currently available

Expenditure Statute Summary

Deductions for income from authorized activities of a domestic international banking

9.00200

48-6-95 facility

9.00300

48-6-95 Deduction for income from banking business with persons or entities outside the U.S.

138 | P a g e

10. Special Assessment of Forest Land Conservation Use Property

10.00000 Special assessment of forest land conservation use property

State Statute

48-5A-2

Year Enacted

2008

Year Effective

2008

Data Source

Office of Planning and Budget

Estimate Reliability

Class A

Data Reliability

Class A

Note

Description Grants made available by the Georgia General Assembly through annual

appropriations and awarded to counties, municipalities and county or

independent school districts for purposes of the Special Assessment of

Forest Land Conservation Use Property program.

State Fiscal Years ($ in Millions)

2012 2013 2014

State Tax Expenditure

14

17

21

(m) Denotes a value of less than $1 million

139 | P a g e

11. Title Fee for Motor Vehicles
Beginning on March 1, 2013 motor vehicles titled in Georgia will be subject to a title fee. This legislation was passed in the 2012 session of the General Assembly. As part of this legislation, sales tax on the sale of motor vehicles will be eliminated for purchases occurring on or after March 1, 2013. The title fee rate in CY2013 will be 6.5% and will increase to 6.75% in CY2014 and to 7% in CY2015. It is estimated that this fee will generate $264 million to the state general fund in FY2013.

Title fee tax expenditures for which an estimate is not currently available

Expenditure 11.001
11.002

Statute 48-5C-1(d)(1)(A)
48-5C-1(3)(7)(A)

Summary Exemption for a vehicle when transferred between immediate family members as a result of the death of an immediate family member Exemption for the sale of a vehicle to a service-connected disabled veteran when the veteran received a grant from the United States Department of Veterans Affairs to purchase and specially adapt the vehicle to his or her disability

140 | P a g e

Appendix of Tables

Expenditure
2.6.013 2.6.031 4.00705
4.00730
4.02500
4.02600 4.02700 4.02800 4.02900 4.02910
4.03400 4.03430 4.03440
4.03500 4.03700
4.04900 4.04910 4.05710 4.05720 4.05730 4.05800

Table 1: Summary of expired and expiring tax expenditures

Summary

Tax

Teleworking Credit
Cigarette export tax credit
Sales of tangible personal property to a nonprofit health center established and receiving funds pursuant to the U.S. Public Health Service Act. Sales of tangible property and services to a nonprofit volunteer health clinic primarily treating patients with incomes below 200% of the poverty level Sale of seed, fertilizer, fungicide, and certain other agricultural chemicals to farmers, and feed for livestock, fish, or poultry purchased by persons engaged in animal husbandry Sale of machinery used exclusively for irrigation of crops to persons primarily engaged in producing farm crops for sale Sales of sugar for use as food to honey bee producers
Sale of cattle, hogs, sheep, horses, poultry, or bees when sold for breeding purposes Sale of certain types of agricultural machinery
Off-road equipment and related attachments used exclusively in site preparation, planting, cultivating, or harvesting of timber by persons primarily engaged in growing or harvesting timber Certain machinery used in the manufacturing of tangible personal property The sale or use of repair or replacement parts, machinery clothing, molds, dies, waxes or tooling for machinery Sales of tangible personal property to or used in or for the construction of a new alternative fuel facility primarily dedicated to the production and processing of ethanol, biodiesel, butanol or their by-products Certain materials used in industrial packaging
Machinery and equipment used in combating air and water pollution and any industrial material used in a burning or recycling process Liquefied gases and other fuels used in poultry or pullet houses or structures Liquefied petroleum gas or other fuel used in a structure where swine are raised Sales of food and beverages to a qualified food bank
Exemption for persons donating prepared food and beverages to a qualified nonprofit agency to be used for hunger relief Exemption for prepared food and beverages that are donated following a natural disaster and used for disaster relief Graduated exemption for the sale of overhead materials used in government contracts

Corporate Income Tax Corporate Income Tax Sales and Use
Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax

Expiration Date
12/31/2011 6/30/2010 6/30/2010
6/30/2010
1/1/2013
1/1/2013 1/1/2013 1/1/2013 1/1/2013 1/1/2013
1/1/2013 1/1/2013 6/30/2012
1/1/2013 1/1/2013
1/1/2013 6/30/2010 6/30/2010 6/30/2011 6/30/2011 1/1/2011

141 | P a g e

Expenditure
4.06400 4.07010
4.07300 4.07400
4.07500 4.07700 4.07800
4.07900 4.08200 4.08600 4.08700 4.08800 4.08900 4.09000 4.09200
4.09300 6.00200

Table 1: Summary of expired and expiring tax expenditures

Summary

Tax

Sales of electricity or fuels used exclusively for the operation of an irrigation system on a farm for crop irrigation Partial exemption for certain sales of natural or artificial gas, fuel oil, propane, petroleum coke and coal used directly or indirectly in the manufacture or processing of tangible personal property primarily for resale Sales of certain production equipment to film producers and film production companies Sale or use of digital broadcast equipment sold to, leased to, or used by a federally licensed commercial or public radio or television broadcast station, a cable network, or a cable distributor Sales tax holiday for back to school items
Liquefied gases and other fuels used in structures where plants, floral products, seedlings, and nursery stock are grown for sale Materials used to construct a new symphony hall costing in excess of $200 million that is owned and operated by a nonprofit organization Ice used to chill poultry or vegetables during processing or shipment Sales tax holiday for water and energy efficient purchases
Sales of engines, parts, equipment and other tangible personal property used in the maintenance or repair of certain aircraft Sales of tangible personal property used to renovate or expand a zoological institution Sales of tangible personal property used in the construction of a qualified civil rights museum The sale of an airplane flight simulation training device
The sale of electricity to a manufacturer located in this state used directly in the manufacture of a product Sales to an organization defined by the Internal Revenue Service as an instrumentality of the states relating to the holding of an annual meeting in this state Sales of tangible personal property used for and in the construction of a competitive project of regional significance Sales to mass transit vehicles

Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Sales and Use Tax
Motor Fuel Tax

Expiration Date
1/1/2013 12/31/2010
1/1/2013 11/1/2008
8/10/2013 1/1/2013 9/1/2011
1/1/2013 10/6/2013 6/30/2013 6/30/2011 7/30/2015 6/30/2011 1/1/2013 12/31/2013
6/30/2014 6/30/2015

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Table 2: Sales and use tax expenditures by type

$ in Millions

Expenditure Summary
Sales Tax Exemption for a Specific Item6

State State State FY2012 FY2013 FY2014

4.00300 4.00400 4.00500 4.01200 4.01300 4.01510 4.01600
4.01800 4.02000 4.02200
4.02300
4.02400 4.03300 4.03700
4.04200
4.04300 4.04700
4.05000
4.05100

Federal retailer's excise tax if separately itemized to the consumer and Georgia motor fuel tax imposed on the sale of motor fuel Sales of transportation furnished by a county or municipal public transit system or public transit authorities Sales of transportation furnished by an approved and authorized urban transit system School lunches sold and served to pupils and employees of public schools School lunches sold and served to pupils and employees of approved private schools Sales of pipe organs or steeple bells to any church qualifying as a nonprofit The sale or use of Holy Bibles; testaments, and similar books commonly recognized as being Holy Scripture regardless of by or to whom sold Charges for transportation of tangible personal property made in connection with interstate or intrastate transportation Water delivered through water mains, lines, or pipes.
Professional, insurance or personal service transactions which involve sales as inconsequential elements for which no separate charge is made Repair services when a separate charge is made to the customer
Rental of videotape or film to persons charging admission to view the tape or film Common or Common and Contract Carriers
Machinery and equipment used in combating air and water pollution and any industrial material used in a burning or recycling process (expiring January 1, 2013) Use or lease of tangible personal property when the lessor and lessee are under 100 percent common ownership and where the person who furnishes, leases, or rents the property has paid sales or use tax on the property Revenues from coin-operated amusement machines for which individual permits are required Sales of drugs dispensed by prescription, prescription glasses, contact lenses, contact lens samples and sales or use of certain controlled substances or dangerous drugs Sales of blood measuring devices, monitoring equipment, or insulin delivery systems used exclusively by diabetics; insulin, insulin syringes and blood glucose monitoring strips Sales of oxygen when prescribed by a licensed physician

4

4

4

6

6

6

Included in 4.00400

8

8

8

(m)

(m)

(m)

(m)

(m)

(m)

Estimate not available at this time

Estimate not available at this time
See expenditure estimate for Residential Utilities (4.5009) See expenditure estimates for services (4.50003, 4.50010,
4.50011) See expenditure estimates for Services (4.50003, 4.50010,
4.50011) Estimate not available at this
time Estimate not available at this
time Estimate not available at this
time

Estimate not available at this time

2

2

2

388

405

423

19

20

22

5

5

5

6 Sales tax exemptions which are defined primarily by the item being purchased and not defined, or only generally defined, by the seller or purchaser.
143 | P a g e

Table 2: Sales and use tax expenditures by type

$ in Millions

Expenditure Summary

4.05200

Sale or use of hearing aids

State State State

FY2012 FY2013 FY2014

4

4

4

4.05400 4.05500

Sale or use of any durable medical equipment or prosthetic device prescribed by a physician Sale of Georgia lottery tickets

Included in 4.04700

160

165

171

4.05700

Food purchased for off premises consumption

432

472

509

4.06200 4.06600

Sod grass sold in the original state of production by the sod producer, employee of the producer, or family member of the producer Sales of gold, silver, or platinum bullion

4.06700

Sales of coins or currency

4.07500

Sales tax holiday for back to school items (expires August 10,

2013)

4.08200

Sales tax holiday for water and energy efficient purchases

(expires October 6, 2013)

4.09100

The sale of prewritten software which has been delivered to the

purchaser electronically or by means of load and leave.

Sales Tax Exemption for a Specific Purchaser7

4

4

4

Estimate not available at this

time

Estimate not available at this

time

0

39

41

0

(m)

(m)

Estimate not available at this time

4.00100 4.00600

Sales to Federal Government, State of Georgia or a county or municipality in Georgia or any agency of such governments Sales to any Hospital Authority created by Georgia law

Estimate not available at this time
Included in 4.00700

4.00610

Sales to any Housing Authority created by Georgia law

2

2

2

4.00620
4.00630 4.00700
4.00710
4.00720 4.00800 4.00900

Sales to local government authorities created on or after January 1, 1980 for the principal purpose of constructing, owning, or operating a coliseum and related facilities Sales to any agricultural commission created by the Department of Agriculture Sales of tangible personal property and services to an approved nursing home, inpatient hospice, general hospital or mental hospital when used specifically in the treatment function. Sales of tangible personal property and services to a nonprofit organization whose primary function is to provide services to persons with intellectual disabilities. Sales to Georgia Society of the Daughters of the American Revolution Sales of tangible personal property and services to the University System of Georgia and its educational units. Sales of tangible personal property and services used exclusively in the educational function of an approved private college or university located in Georgia whose credits are accepted by the University System of Georgia.

(m)

(m)

(m)

(m)

(m)

(m)

82

85

87

2

2

2

(m)

(m)

(m)

29

30

31

Estimate not available at this time

7 Sales tax exemptions which are defined primarily by the purchaser and not defined, or only generally defined, by the seller or the item being purchased.
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Table 2: Sales and use tax expenditures by type

$ in Millions

Expenditure Summary

4.01000

Sales of tangible personal property and services used exclusively

in the educational function of an approved private elementary or

secondary school

4.01100

Sales of tangible personal property or services to, and the

purchase of tangible personal property or services by, any

educational or cultural institute

4.01700

Sales of fuel or consumable supplies used by ships engaged in

inter-coastal or foreign commerce

4.01900

All tangible personal property purchased outside this state by a

nonresident when the property is brought into Georgia upon the

nonresident becoming a resident

4.02100

Sales, transfers or exchanges of tangible personal property

resulting from business reorganization when the owners, partners,

or stockholders maintain the same proportionate interest or share

in the newly formed business

4.04100

Sale of tangible personal property and services to a nonprofit

child-caring institute, child-placing agency, or maternity home

4.04600

Sales of tangible personal property or taxable services to

nonprofit blood banks

4.07100

Sales to or by an organization whose primary purpose is to raise

funds for books, materials, and programs for public libraries

4.08800

Sales of tangible personal property used in the construction of a

qualified civil rights museum (expires 7/30/2015)

4.09200

Sales to an organization defined by the Internal Revenue Service

as an instrumentality of the states relating to the holding of an

annual meeting in this state for the period commencing July 1,

2012, and ending on December 31, 2013.

4.09300

Sales of tangible personal property used for and in the

construction of a competitive project of regional significance, for

the period commencing January 1, 2012, until June 30, 2014.

4.3.20000

Exemptions for energy, machinery or equipment, industrial

material, and consumable supplies used in manufacturing

4.3.30000

Sales and use by a qualified agriculture producer of agricultural

production inputs, energy used in agriculture, and agricultural

machinery and equipment

Sales Tax Exemption for a Specific Seller8

State State State

FY2012 FY2013 FY2014

2

2

2

Estimate not available at this time

23

23

23

Estimate not available at this time

Estimate not available at this time

1

1

1

(m)

(m)

(m)

(m)

(m)

(m)

(m)

(m)

(m)

Estimate not available at this time

Estimate not available at this time
Estimate not available at this time
Estimate not available at this time

4.00200
4.01500 4.03800

Tangible personal property furnished by the Federal Government or any county or municipality used by a contractor in the installation, repair, or extension of any public water, gas, or sewer system. Specific fundraising sales by any religious institution lasting no more than 30 days in a calendar year. Sale of tangible personal property and fees and charges for services by the Rock Eagle 4-H center

Estimate not available at this time

(m)

(m)

(m)

(m)

(m)

(m)

8 Sales tax exemptions which are defined primarily by the seller and not defined, or only generally defined, by the purchaser or the item being purchased.
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Table 2: Sales and use tax expenditures by type

$ in Millions

Expenditure 4.03900
4.05600

Summary Certain sales by a public or private school of tangible personal property, concessions, and tickets for admission to school functions Sales by any qualified nonprofit parent teacher organization

State State State

FY2012 FY2013 FY2014

3

3

3

(m)

(m)

(m)

4.05900 4.90000

Sales of eligible food and beverages for on or off-premises consumption by any Girl or Boy Scout council Sales tax exemption for casual sales

1

1

1

151

125

2

Sales Tax Exemption for a Specific Purchaser of a Specific Item9

4.01400 4.02500
4.02600
4.02700 4.02800 4.02900 4.02910
4.03000
4.03100 4.03200
4.03310 4.03400 4.03410 4.03420 4.03430

Sales of art and other artifacts for display or exhibition to museums Sale of seed, fertilizer, fungicide, and certain other agricultural chemicals to farmers, and feed for livestock, fish, or poultry purchased by persons engaged in animal husbandry (expires January 1, 2013) Sale of machinery used exclusively for irrigation of crops to persons primarily engaged in producing farm crops for sale (expires January 1, 2013) Sales of sugar for use as food to honey bee producers (expires January 1, 2013) Sale of cattle, hogs, sheep, horses, poultry, or bees when sold for breeding purposes (expires January 1, 2013) Sale of certain types of agricultural machinery (expires January 1, 2013) Off-road equipment and related attachments used exclusively in site preparation, planting, cultivating, or harvesting of timber by persons primarily engaged in growing or harvesting timber (expires January 1, 2013) Vehicles purchased by service-connected disabled veterans when the U.S. Dept. of Veterans Affairs supplies a grant to purchase the specially adapted vehicle Sale of tangible personal property manufactured or assembled in Georgia for export when delivery is taken outside of Georgia Aircraft, watercraft, motor vehicles, and other transportation equipment manufactured or assembled in this State for exclusive use outside Georgia Partial sales tax exemption for jet fuel sold to or used by a qualifying airline at a qualifying airport Certain machinery used in the manufacturing of tangible personal property (expires January 1, 2013) Machinery and equipment used to handle, move, or store tangible personal property in certain distribution facilities Machinery and equipment used directly to remanufacture certain aircraft engines or aircraft engine parts The sale or use of repair or replacement parts, machinery clothing, molds, dies, waxes or tooling for machinery (expires January 1, 2013)

(m)

(m)

(m)

150

80

0

1

(m)

0

(m)

(m)

0

2

1

0

33

17

0

12

6

0

(m)

(m)

(m)

Estimate not available at this time
Estimate not available at this time

20

21

22

175

90

0

3

3

3

(m)

(m)

(m)

Estimate not available at this time

9 Sales tax exemptions which are specifically defined by the purchaser as well as the item being purchased.
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Expenditure 4.03440
4.03500 4.03600 4.03610 4.03700
4.03910
4.04000 4.04400 4.04500 4.04800 4.04900 4.05300 4.06000 4.06100 4.06300 4.06400
4.06500 4.06800 4.06900 4.07000 4.07200 4.07300

Table 2: Sales and use tax expenditures by type

$ in Millions

Summary Sales of tangible personal property to or used in or for the construction of a new alternative fuel facility primarily dedicated to the production and processing of ethanol, biodiesel, butanol or their by-products (expired 6/30/2012) Certain materials used in industrial packaging (expires January 1, 2013) Machinery and equipment used in a facility for the primary purpose of reducing or eliminating air and water pollution Machinery and equipment used for water conservation and incorporated into a qualified water conservation facility. Machinery and equipment used in combating air and water pollution and any industrial material used in a burning or recycling process (expiring January 1, 2013) Cargo containers and related chassis used for storage or shipping by persons engaged in international shipment of tangible personal property Sale of major components or repair parts installed in military aircraft, vehicles, or missiles Sales of motor vehicles to nonresident purchasers when vehicles are immediately removed from Georgia and titled in another state. The sale or use of paper stock when used to print catalogs for distribution outside Georgia. Sales of crab bait to licensed commercial fishermen

State State State

FY2012 FY2013 FY2014

2

0

0

Estimate not available at this time
Estimate not available at this time
Estimate not available at this time
Estimate not available at this time

Estimate not available at this time

44

40

34

Estimate not available at this

time

Estimate not available at this

time

(m)

(m)

(m)

Liquefied gases and other fuels used in poultry or pullet houses or structures (expires January 1, 2013) Transactions where food stamps or WIC coupons are used as the method of payment Sales of certain machinery and equipment used to improve air quality in a clean room of Class 100,000 or less Advertising inserts that are used in newspapers for resale
Funeral merchandise when paid with funds from the Georgia Crime Victims' Emergency fund Sales of electricity or fuels used exclusively for the operation of an irrigation system on a farm for crop irrigation (expires January 1, 2013) Sales of dyed diesel fuel used exclusively for operations of vessels or boats by licensed commercial fishermen Sales of certain computer equipment when the total qualifying purchases by a high technology company exceed $15 million Sales of machinery and equipment and material incorporated and used in a clean room of Class 100 or less Sales of natural gas used directly in the manufacture of electricity

3

2

0

123

117

111

Estimate not available at this

time

Estimate not available at this

time

(m)

(m)

(m)

20

15

0

(m)

(m)

(m)

Estimate not available at this

time

Estimate not available at this

time

37

36

36

Sales of wheelchairs and attachments for wheelchairs when sold to permanently disabled individuals Sales of certain production equipment to film producers and film production companies (expires January 1, 2013)

Included in 4.04700

10

5

0

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Expenditure 4.07700
4.07800
4.07900 4.08100 4.08300 4.08600
4.09000 4.09400

Table 2: Sales and use tax expenditures by type

$ in Millions

Summary Liquefied gases and other fuels used in structures where plants, floral products, seedlings, and nursery stock are grown for sale (expires January 1, 2013) Materials used to construct a new symphony hall costing in excess of $200 million that is owned and operated by a nonprofit organization (expired 9/1/2011) Ice used to chill poultry or vegetables during processing or shipment (expires January 1, 2013) The purchase of food and nonalcoholic beverages provided at no charge aboard a qualified airline Sale of biomass materials used to produce electricity or steam or used to produce electricity and steam intended for sale Sales of engines, parts, equipment and other tangible personal property used in the maintenance or repair of certain aircraft (expires 6/30/2013) The sale of electricity to a manufacturer located in this state used directly in the manufacture of a product (expires January 1, 2013) The sale, use, consumption, or storage of materials, containers, labels, sacks, or bags used for packaging tangible personal property for shipment or sale.

State State State

FY2012 FY2013 FY2014

1

(m)

0

0

0

0

Estimate not available at this

time

5

4

4

(m)

(m)

(m)

7

7

0

Estimate not available at this time
Estimate not available at this time

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Tables 3-8: Distributional tables of selected provisions
Tables 3 through 8 provide information on the distribution across Georgia AGI for several exemptions and deductions from the state individual income tax. Due to a lack of data and for reasons of confidentiality, these tables cannot be produced for other provisions. The data used to produce the tables is from the state individual income tax files for 2009. It has not been adjusted for inflation to represent 2012 levels nor does it reflect any legislative changes that may have occurred since 2009. Column 1 of each table provides the categories of Georgia AGI. Column 2 provides the number of returns for each AGI category. Column 3 gives the average value of the tax exemption or deduction taken by filers in each AGI category. Column 4 provides the total value of the deduction or exemption associated with each AGI category and column 5 provides the percent of the total value of the deduction or exemption that falls into that AGI category.

Georgia AGI 2009-
GA AGI0 0<GA AGI$25,000 $25,000<GA AGI$50,000 $50,000<GA AGI$100,000 $100,000<GA AGI$500,000 $500,000<GA AGI$1,000,000 GA AGI>$1,000,000 Total
Based on full year resident filers only.

Table 3: Total Personal Exemptions

Number of Average Value

Total

Returns

Percent of Total

295,116 1,542,815 843,332 677,437 378,534
11,357 4,659 3,753,250

$4,126

$1,217,682,300

5%

$5,168

$7,973,630,700

35%

$6,072

$5,120,517,900

23%

$7,127

$4,827,912,300

22%

$8,497

$3,216,232,800

14%

$9,120

$103,574,700

1%

$8,643

$40,266,900

0%

$22,499,817,600

Georgia AGI 2009-
GA AGI0 0<GA AGI$25,000 $25,000<GA AGI$50,000 $50,000<GA AGI$100,000 $100,000<GA AGI$500,000 $500,000<GA AGI$1,000,000 GA AGI>$1,000,000 Total
Based on full year resident filers only.

Table 4: Retirement Exemption

Number of Average Value

Total

Returns

Percent of Total

228,105 185,229 80,362 62,830 35,495 1,828 1,010 594,859

$17,198 $3,922,887,959

32%

$21,613 $4,003,372,675

32%

$22,257 $1,788,616,068

15%

$23,490 $1,475,874,349

12%

$28,832 $1,023,374,139

8%

$41,618

$76,077,138

1%

$47,400

$47,873,855

0%

$12,338,076,184

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Georgia AGI 2009-

Table 5: Georgia Higher Education Savings Deduction

Number of Average Value

Total

Returns

GA AGI0 0<GA AGI$25,000 $25,000<GA AGI$50,000 $50,000<GA AGI$100,000 $100,000<GA AGI$500,000 $500,000<GA AGI$1,000,000 GA AGI>$1,000,000 Total
Based on full year resident filers only..

325 1,296 1,795 6,124 12,964 436 114 23,054

$1,763 $1,565 $1,536 $1,619 $2,393 $3,770 $3,748

$572,994 $2,028,719 $2,757,321 $9,915,027 $31,026,993 $1,643,624 $427,227 $48,371,905

Percent of Total
1% 4% 6% 21% 64% 3% 1%

Georgia AGI - 2009

Table 6: Interest on U.S. Obligations

Number of Average Value

Total

Returns

GA AGI0 0<GA AGI$25,000 $25,000<GA AGI$50,000 $50,000<GA AGI$100,000 $100,000<GA AGI$500,000 $500,000<GA AGI$1,000,000 GA AGI>$1,000,000 Total
Based on full year resident filers only.

9,618 13,028 8,511 13,059 15,105 1,431 1,004 61,756

$3,431 $1,932 $1,841 $1,493 $1,859 $5,139 $12,795

$32,995,796 $25,167,208 $15,671,382 $19,495,979 $28,074,843 $7,354,111 $12,846,486 $141,605,805

Percent of Total
23% 18% 11% 14% 20% 5% 9%

Georgia AGI 2009-

Table 7: Blind and Age 65 Deduction

Number of Returns

Average Value

Total

GA AGI0 0<GA AGI$25,000 $25,000<GA AGI$50,000 $50,000<GA AGI$100,000 $100,000<GA AGI$500,000 $500,000<GA AGI$1,000,000 GA AGI>$1,000,000 Total
Based on full year resident filers only.

167,180 99,988 25,453 10,536 1,687
17 8 304869

$1,778 $1,784 $1,763 $1,777 $1,923 $1,835 $2,113

$297,258,700 $178,426,314 $44,862,300 $18,718,400 $3,244,800
$31,200 $16,900 $542,558,614

Percent of Total
55% 33% 8% 3% 1% 0% 0%

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Georgia AGI 2009-
GA AGI0 0<GA AGI$25,000 $25,000<GA AGI$50,000 $50,000<GA AGI$100,000 $100,000<GA AGI$500,000 $500,000<GA AGI$1,000,000 GA AGI>$1,000,000 Total
Based on full year resident filers only.

Table 8: Standard Deduction

Number of Returns
218,227 1,363,969 500,859 182,849
17,966 62 17
2,283,949

Average Value

Total

Percent of Total

$2,548

$556,112,300

10%

$2,386

$3,254,271,100

58%

$2,514

$1,259,233,439

22%

$2,771

$506,763,225

9%

$2,939

$52,803,951

1%

$2,732

$169,400

0%

$2,441

$41,500

0%

$5,629,394,915

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