HB1176: HB1176 Sales and use tax; sale of any tangible personal property used or consumed in connection with the generation, transmission, distribution, sale, or furnishing of electricity; exempt

Georgia currently charges sales and use tax on most tangible personal property purchases, including equipment utilities buy to generate and deliver electricity. This bill would create a new exemption in Georgia's sales tax code (O.C.G.A. § 48-8-3) for purchases by public utilities of property used or consumed in connection with generating, transmitting, distributing, selling, or furnishing electricity within Georgia. The exemption would begin on January 1, 2027, and would apply not just to the state sales tax but also to local sales and use taxes, including special local taxes such as the MARTA sales tax and other local option sales taxes authorized under specific parts of Georgia's tax code. The bill defines 'local sales and use tax' broadly to cover these local levies. It repeals any conflicting laws.

• Adds a new exemption to Georgia's sales and use tax law (O.C.G.A. § 48-8-3) for public utilities buying equipment tied to generating, transmitting, distributing, selling, or furnishing electricity.
• Sets the exemption to begin on January 1, 2027, rather than applying immediately.
• Extends the exemption to local sales and use taxes, including taxes like the MARTA transit sales tax and other local option sales taxes.
• Defines what counts as a 'local sales and use tax' for purposes of the exemption, covering a range of locally authorized taxes.
• Repeals any existing laws that conflict with the new exemption.

Public utilities that generate, transmit, distribute, sell, or furnish electricity in Georgia would benefit directly from the tax exemption. State and local governments that rely on sales and use tax revenue, including MARTA and other localities with local option sales taxes, would see reduced collections from utility purchases.

By removing sales tax on equipment tied to electricity generation and delivery, utilities would face lower costs on qualifying purchases starting in 2027. Because the exemption also applies to local sales taxes, cities, counties, and transit systems like MARTA could see a corresponding reduction in local tax revenue.

• Section 1 amends O.C.G.A. § 48-8-3 by adding paragraph (106), exempting sales to public utilities of tangible personal property used or consumed in connection with generating, transmitting, distributing, selling, or furnishing electricity in Georgia.
• The exemption takes effect January 1, 2027, rather than upon the bill's passage.
• Paragraph (106)(B) defines 'local sales and use tax' to include taxes authorized by constitutional amendment, the Metropolitan Atlanta Rapid Transit Authority Act of 1965, and other local sales tax articles of the tax code.
• The bill specifies the exemption applies to local sales and use taxes as well as the state tax.
• Section 2 repeals any conflicting laws.

1. 2026-02-05House Second Readers (House)
2. 2026-02-04House First Readers (House)
3. 2026-02-03House Hopper (House)

• Charles Cannon (R, HD-172)Primary sponsor
• David Huddleston (R, HD-072)
• Trey Rhodes (R, HD-124)
• Robert Dickey (R, HD-134)
• Ron Stephens (R, HD-164)

• sales tax exemptions
• utility regulation
• electricity
• local tax revenue
• tax policy