HB 276: Income tax; change certain definitions

This bill adds a new state income tax credit (O.C.G.A. § 48-7-40.38) for taxpayers who buy and install a 'power generator' running on woody biomass, such as wood scraps or pellets, with at least 50 megawatts of capacity used at least half the time. The credit equals $500,000 per megawatt of capacity, can be claimed for up to five years, and is capped at $200 million per taxpayer and $1.6 billion total statewide. Unused credits can carry forward ten years but must be claimed by December 31, 2036, and can be sold or transferred once to another Georgia taxpayer under strict reporting rules. The Department of Revenue can recapture credits and requires taxpayers to reimburse audit costs. The bill also changes Georgia's sales tax exemptions for high-technology companies and high-technology data centers (O.C.G.A. § 48-8-3). Starting in 2029, the exemption for high-tech companies would be limited mainly to companies in certain low-population 'tier 1' counties, a specific barrier island county, or companies that use their own woody biomass power generators. A similar limitation would apply to high-technology data centers starting in 2032, extending their exemption through 2037 under the same biomass-generator and location conditions.

• Creates a new state income tax credit for buying, installing, and readying a woody biomass power generator of at least 50 megawatts capacity used at least half the time.
• Sets the credit at $500,000 per megawatt for up to five taxable years, capped at $200 million per taxpayer and $1.6 billion statewide, with claims allowed only through December 31, 2036.
• Allows unused credits to be carried forward for ten years and sold or transferred once to a single other Georgia taxpayer, with mandatory notice to the Department of Revenue.
• Requires taxpayers claiming the credit to reimburse the state for department-initiated audits tied to the credit and lets the commissioner recapture wrongly claimed credits.
• Narrows, starting in 2029, the sales tax exemption for certain high-technology companies to those in specific tier 1 counties, a designated barrier island county, or those using qualifying on-site biomass power generators.
• Extends and similarly limits, starting in 2032, the sales tax exemption for high-technology data centers through 2037 based on location or use of on-site biomass power generators.

Companies that build or operate large wood-fueled electric generators, high-technology manufacturers and data center operators that currently qualify for Georgia sales tax exemptions, county governments in tier 1 or barrier-island areas, and the Georgia Department of Revenue, which will certify, audit, and track these credits and exemptions.

The new tax credit could steer significant private investment toward wood-fueled power plants in Georgia while reducing state tax revenue by up to $1.6 billion over time. The changes to high-tech sales tax exemptions would concentrate future eligibility in certain rural or biomass-using facilities rather than tech companies statewide.

• Section 1 adds new Code Section 48-7-40.38, defining 'power generator,' 'capacity,' and 'woody biomass' and creating the income tax credit and its caps, deadlines, transfer rules, and audit and recapture provisions.
• Section 2 revises O.C.G.A. § 48-8-3, paragraph (68), narrowing the existing 10 percent reduced-tax treatment for high-technology company computer equipment purchases to end December 31, 2028, then further limiting eligibility from 2029 through 2034 to tier 1 counties, a specific barrier island county, or companies using qualifying biomass generators.
• Section 2 also revises paragraph (68.1) governing high-technology data center sales tax exemptions, replacing the automatic repeal on January 1, 2032 with a new limited exemption running through December 31, 2037 tied to the same county and biomass-generator conditions.
• Section 3 repeals any conflicting state laws.

1. 2026-03-06House Committee Favorably Reported By Substitute (House)
2. 2025-02-10House Second Readers (House)
3. 2025-02-06House First Readers (House)
4. 2025-02-05House Hopper (House)

• James Burchett (R, HD-176)Primary sponsor
• Bruce Williamson (R, HD-112)
• Vance Smith (R, HD-138)
• Trey Kelley (R, HD-016)
• Shaw Blackmon (R, HD-146)
• Clint Crowe (R, HD-118)

• income tax credits
• biomass energy
• data center tax breaks
• high-tech manufacturing incentives
• state tax exemptions