HB537: HB537 Revenue and taxation; maximum amount of local sales and use taxes that may be imposed; provide

25 LC 50 1140 House Bill 537 By: Representative Blackmon of the 146th A BILL TO BE ENTITLED AN ACT To amend Chapter 8 of Title 48 of the Official Code of Georgia Annotated, relating to sales1 and use taxes, so as to provide for the maximum amount of local sales and use taxes that may2 be imposed; to revise provisions related to a special district sales and use tax; to provide for3 conditions under which such tax may be imposed; to provide for clarifications; to provide for4 related matters; to repeal conflicting laws; and for other purposes.5 BE IT ENACTED BY THE GENERAL ASSEMBLY OF GEORGIA:6 SECTION 1.7 Chapter 8 of Title 48 of the Official Code of Georgia Annotated , relating to sales and use8 taxes, is amended in Code Section 48-8-6, relating to prohibiti on of political subdivisions9 from imposing various taxes, ceiling on local sales and use tax es, and taxation of mobile10 telecommunications, by revising subsection (a) as follows:11 "(a)(1) Except as provided in this subsection, on and after July 1, 2024, there shall not12 be imposed in any jurisdiction in this state or on any transaction in this state local sales13 taxes, local use taxes, or local sales and use taxes in excess of 2 percent. For purposes14 of this such 2 percent limitation, the taxes affected are any sales tax, use tax, or sales and15 use tax which is levied in an area consisting of less than the entire state, however16 H. B. 537 - 1 - 25 LC 50 1140 authorized, including such taxes authorized by or pursuant to constitutional amendment,17 and regardless of whether another provision of law purports to the contrary, except for18 the following:19 (A) A 1 percent sales and use tax for educational purposes exe mpted from such20 limitation under Article VIII, Section VI, Paragraph IV of the Constitution;21 (B) Up to 1 percent in aggregate of any of the transportation related sales and use taxes22 authorized under Articles 5, 5A, and 5B of this chapter and Art icle 2 of Chapter 9 of23 Title 32; and24 (C) Up to 1 percent in aggregate of any tax levied for purposes of a metropolitan area25 system of public transportation, as authorized by the amendment to the Constitution set26 out at Georgia Laws, 1964, page 1008; the continuation of such amendment under27 Article XI, Section I, Paragraph IV(d) of the Constitution; and the laws enacted28 pursuant to such constitutional amendment; provided, however, t hat the exception29 provided for under this paragraph shall only apply in a county in which a tax is levied30 and collected pursuant to Part 2 of Article 2A of this chapter; and31 (D) Up to 1 percent in aggregate of any sales and use taxes autho rized under Code32 Section 48-8-96, Code Section 48-8-97, Article 2B of this chapter, Part 3 of Article 333 of this chapter, and Article 4 of this chapter.34 (2) Notwithstanding any provision of law to the contrary, any tax that does not comply35 with the limitations provided in paragraph (1) of this subsection as of July 1, 2025, but36 was initiated in compliance with the law in effect prior to Jan uary 1, 2025, shall be37 allowed to continue as authorized under laws that existed prior to July 1, 2025; provided,38 however, that, upon the expiration or termination of any such tax, such tax shall not be39 renewed and the jurisdiction that levied such tax shall be fully subject to the limitations40 imposed by this subsection.41 (3) This subsection shall not limit the imposition of any loca l excise tax, which is42 separately authorized under Chapter 13 of this title.43 H. B. 537 - 2 - 25 LC 50 1140 (4) Except as provided in paragraph (2) of this subsection, if If the imposition of any44 otherwise authorized local sales tax, local use tax, or local sales and use tax would result45 in a tax rate in excess of tha t authorized by this subsection, then such otherwise46 authorized tax shall not be imposed."47 SECTION 2.48 Said chapter is further amended by revising Code Section 48-8-109.31, relating to imposition49 of special sales and use tax within special district and limited time and purpose, as follows:50 "48-8-109.31.51 (a) Subject to the requirement of approval by local referendum and the other requirements52 of this article, to impose there may be imposed within any given special district a special53 sales and use tax for a limited period of time for the limited purpose of property tax relief.54 (b) Except as to rate, a tax imposed under this part shall correspond to the tax imposed by55 Article 1 of this chapter. No item or transaction which is not subject to taxation under56 Article 1 of this chapter shall be subject to a tax imposed under this article, except that a57 tax imposed under this article shall apply to sales of motor fu els as prepaid local tax as58 defined in Code Section 48-8-2 and shall be applicable to the s ale of food and food59 ingredients and alcoholic beverages as provided for in Code Section 48-8-3.60 (c) The special sales and use tax provided for in subsection (a) of this Code section may61 be imposed by a special district in 0.05 percent increments, but in no event shall such tax62 exceed 1 percent in total. The levy of such tax upon sales of motor fuels as defined in63 Code Section 48-9-2 shall only be imposed on the retail sales price of the motor fuel which64 is not more than $3.00 per gallon.65 (d)(1) As a condition precedent to the issuance of the call for the referendum:66 (A)(1) The governing authority of the county whose geographical boun dary is67 conterminous with that of the special district and the governing authority or authorities68 of all municipalities that levy an ad valorem tax on property, other than those69 H. B. 537 - 3 - 25 LC 50 1140 municipalities that are excluded from the special district purs uant to paragraph (3)70 subsection (f) of this subsection Code section , shall have in effect a base year value71 homestead exemption or adjusted base year value homestead exemption; and72 (B)(2) The governing authority of the county whose geographical boun dary is73 conterminous with that of the special district and the governing authority or authorities,74 if any, that represent at least 50 percent of the special district's residents of municipalities75 that levy an ad valorem tax on property, other than those municipalities that are excluded76 from the special district pursuant to paragraph (3) of this subsection (f) of this Code77 section, shall enter into an intergovernmental agreement calling for t he tax authorized78 under this article and specifying the proposed rate of the tax, the proposed maximum79 period of time that the tax is to be levied, and the proposed distribution of the tax.80 (e)(1) As used in this subsection, the term 'absent municipality' means any municipality81 that levies an ad valorem tax on property, other than those mun icipalities that are82 excluded from the special district pursuant to subsection (f) of this Code section, and that83 did not enter into the intergovernmental agreement provided for in paragraph (2) of84 subsection (d) of this Code section.85 (2) If the combined total of the populations of all such absent municipalities is less than86 one-half of the aggregate population of all municipalities loca ted within the special87 district that levy an ad valorem tax on property, the political subdivisions governing88 authorities entering into the such intergovernmental agreement shall, on in behalf of such89 absent municipalities, specify a percentage of that portion of the remaining proceeds90 which each municipality that levies an ad valorem tax on property shall receive, which91 percentage shall not be less than that proportion which each such absent municipality's92 population bears to the total population of all municipalities that levy ad valorem taxes93 on property within the special district multiplied by that port ion of the remaining94 proceeds which are received by all such municipalities within t he special district. No95 portion of the tax shall be apportioned to counties and or municipalities that do not levy96 H. B. 537 - 4 - 25 LC 50 1140 an ad valorem tax on property or do not have a base year value homestead exemption or97 adjusted base year value homestead exemption in effect.98 (f)(3) Subject to the limitation provided for in Code Section 48-8-6 , any special district99 which wholly or partially contains a jurisdiction levying the t ax provided for under100 Article 4 of this chapter is authorized to levy the tax authorized under this article. Such tax101 authorized under this article may only be levied in the areas of the special district outside102 of the jurisdiction levying the tax provided for under Article 4 of this chapter. Any103 jurisdiction levying the tax provided for under Article 4 of t his chapter shall not be104 considered within the procedure necessary to levy the tax under this article and shall not105 be entitled to any portion of said tax."106 SECTION 3.107 Said chapter is further amended in Code Section 48-8-109.32, relating to maximum period108 of time of the tax, submission to voters to determine imposition of tax, ballot language, and109 expenses of election, by adding a new subsection to read as follows:110 "(e) If no intergovernmental agreement is required pursuant to this article, the governing111 authority of the county or consolidated government whose geogra phical boundary is112 conterminous with that of the special district shall adopt a re solution which meets the113 requirements provided for in this Code section for intergovernmental agreements."114 SECTION 4.115 Said chapter is further amended in Code Section 48-8-109.33, re lating to timing for116 imposition of tax following approval and termination of tax, by revising paragraph (2) of117 subsection (a) and subsection (c) as follows:118 "(2) With respect to services that are regularly billed on a monthly basis, however, the119 resolution or ordinance imposing the tax shall become effective and the tax shall apply120 to the first regular billing period coinciding with or following the effective date specified121 H. B. 537 - 5 - 25 LC 50 1140 in paragraph (1) of this subsection. A certified copy of the ordinance intergovernmental122 agreement or resolution imposing required to impose the tax authorized by this article123 shall be forwarded to the commissioner to ensure it is received within five business days124 after certification of the election results."125 "(c) For any special district in which a tax authorized by this article is in effect may, while126 such tax is in effect, the General Assembly may pass a local Act calling for a reimposition127 of a tax as authorized by this article upon the termination of the tax then in effect, and a128 referendum may be held for this purpose while the tax is in effect. Proceedings for such129 reimposition shall be in the same manner as proceedings for the initial imposition of the130 tax as provided for in Code Section Sections 48-8-109.31 and 48-8-109.32. Such newly131 authorized tax shall not be imposed until the expiration of the tax then in effect."132 SECTION 5.133 All laws and parts of laws in conflict with this Act are repealed.134 H. B. 537 - 6 -