HB 1535 - Ad valorem, income, and sales taxes; certain printing services

First Reader Summary

A BILL to amend Title 48 of the Official Code of Georgia Annotated, relating to revenue and taxation, so as to provide additional conditions under which certain property shall not acquire a situs in this state for ad valorem tax purposes; to provide that certain property ownership or conducting of business shall not constitute activities subject to state income tax; and for other purposes.

Buck, III, Thomas B (135th) Crawford, Robert (Mack) M (129th) Royal, A. Richard (164th)
Culbreth, Ronnie (132nd) Heard, Keith G (89th) Felton, Dorothy (43rd)
Status Summary HC: W&M SC: F&PU LA: 03/27/98 Signed by Governor
Page Numbers - 1/ 2/ 3/ 4
Code Sections - 48-5-5
House Action Senate
2/4/98 Read 1st Time 2/13/98
2/5/98 Read 2nd Time 2/23/98
2/10/98 Favorably Reported 2/20/98
Sub Committee Amend/Sub
2/12/98 Read 3rd Time 2/24/98
2/12/98 Passed/Adopted 2/24/98
CS Comm/Floor Amend/Sub
3/23/98 Sent to Governor
3/27/98 Signed by Governor
519 Act/Veto Number
7/1/98 Effective Date

HB 1535                                         LC 18 8739ERS 
 
 
 
 
 
 
                        A BILL TO BE ENTITLED 
                               AN ACT 
 
 
  1- 1  To amend Title 48 of the Official Code of Georgia Annotated, 
  1- 2  relating to revenue and taxation, so as to provide 
  1- 3  additional conditions under which certain property shall not 
  1- 4  acquire a situs in this  state for ad valorem tax purposes; 
  1- 5  to provide that certain property ownership or conducting of 
  1- 6  business shall not constitute activities subject to state 
  1- 7  income tax; to provide that certain persons and activities 
  1- 8  shall not constitute a dealer for sales and use tax 
  1- 9  purposes; to provide for effective dates; to provide for 
  1-10  applicability; to repeal conflicting laws; and for other 
  1-11  purposes. 
 
  1-12       BE IT ENACTED BY THE GENERAL ASSEMBLY OF GEORGIA: 
 
  1-13                           SECTION 1. 
 
  1-14  Title 48 of the Official Code of Georgia Annotated, relating 
  1-15  to revenue and taxation, is amended by striking Code Section 
  1-16  48-5-5, relating to acquisition of situs, and inserting in 
  1-17  its place a new Code Section 48-5-5 to read as follows: 
 
  1-18    "48-5-5. 
 
  1-19    (a) Foreign merchandise in transit shall acquire no situs 
  1-20    so as to become subject to ad valorem taxation by 
  1-21    political subdivisions of this state in which the port of 
  1-22    original entry or the port of export of such merchandise 
  1-23    is located.  Such property shall not acquire situs by 
  1-24    virtue of the fact that while in the warehouse the 
  1-25    property is assembled, bound, joined, processed, 
  1-26    disassembled, divided, cut, broken in bulk, relabeled, or 
  1-27    repackaged.  The grant of 'no situs' status shall be 
  1-28    liberally construed to effect the purposes of this Code 
  1-29    section. 
 
  1-30    (b) Property which meets all of the following 
  1-31    qualifications shall acquire no situs so as to become 
  1-32    subject to ad valorem taxation by political subdivisions 
  1-33    of this state: 
 
 
 
                                 -1- 
 
 
 
  2- 1      (1) Such property is owned by a person who is not a 
  2- 2      Georgia resident and does not maintain or operate a 
  2- 3      place of business in Georgia; 
 
  2- 4      (2) Such person has contracted with a commercial printer 
  2- 5      located in Georgia for printing services to be performed 
  2- 6      in Georgia; and 
 
  2- 7      (3) Such property is provided by such person to such 
  2- 8      printer for the performance of such services." 
 
  2- 9                           SECTION 2. 
 
  2-10  Said title is further amended by adding a new paragraph 
  2-11  immediately following paragraph (7) of Code Section 48-7-1, 
  2-12  relating to definitions regarding income tax, to be 
  2-13  designated paragraph (7.1) to read as follows: 
 
  2-14      "(7.1) 'Owning property or doing business in this state' 
  2-15      shall not include the following activities, either 
  2-16      singularly or in the aggregate, with respect to any 
  2-17      person that is not otherwise subject to income taxation 
  2-18      in the State of Georgia that has contracted with a 
  2-19      commercial printer for any printing, including printing 
  2-20      related activities, and distribution services to be 
  2-21      performed in Georgia: 
 
  2-22        (A) The ownership by that person of tangible or 
  2-23        intangible property located at the Georgia premises of 
  2-24        the commercial printer for use by the printer in 
  2-25        performing its services for the owner; 
 
  2-26        (B) The sale and distribution by that person of 
  2-27        printed material produced at and shipped or 
  2-28        distributed from the Georgia premises of the 
  2-29        commercial printer; 
 
  2-30        (C) The activities performed by  or on behalf of that 
  2-31        person at the Georgia premises of the commercial 
  2-32        printer which are directly related to the services 
  2-33        provided by that commercial printer; or 
 
  2-34        (D) The printing, including printing related 
  2-35        activities and distribution related activities, 
  2-36        performed by the commercial printer in Georgia for or 
  2-37        on behalf of that person." 
 
  2-38                           SECTION 3. 
 
  2-39  Said title is further amended in paragraph (3) of Code 
  2-40  Section 48-8-2, relating to definitions regarding sales and 
 
 
 
                                 -2- 
 
 
 
  3- 1  use tax, by striking the word "or" at the end of 
  3- 2  subparagraph (G), by striking the period and adding "; or" 
  3- 3  at the end of subparagraph (H), and by adding a new 
  3- 4  subparagraph at the end thereof to be designated 
  3- 5  subparagraph (I) to read as follows: 
 
  3- 6        "(I) Notwithstanding any of the provisions contained 
  3- 7        in this paragraph, with respect to a person that is 
  3- 8        not a resident or domiciliary of Georgia, that does 
  3- 9        not engage in any other business or activity in 
  3-10        Georgia, and that has contracted with a commercial 
  3-11        printer for printing to be conducted in Georgia, such 
  3-12        person shall not be deemed a 'dealer' in Georgia 
  3-13        merely because such person: 
 
  3-14          (i) Owns tangible or intangible property which is 
  3-15          located at the Georgia premises of a commercial 
  3-16          printer for use by such printer in performing 
  3-17          services for the owner; 
 
  3-18          (ii) Makes sales and distributions of printed 
  3-19          material produced at and shipped or distributed from 
  3-20          the Georgia premises of the commercial printer; 
 
  3-21          (iii) Performs activities of any kind at the Georgia 
  3-22          premises of the commercial printer which are 
  3-23          directly related to the services provided by the 
  3-24          commercial printer; or 
 
  3-25          (iv) Has printing, including any printing related 
  3-26          activities, and distribution related activities 
  3-27          performed by the commercial printer in Georgia for 
  3-28          or on its behalf, 
 
  3-29        nor shall such person, absent any contact with Georgia 
  3-30        other than with or through the use of the commercial 
  3-31        printer or the use of the U.S. Postal Service or a 
  3-32        common carrier, have an obligation to collect sales or 
  3-33        use tax from any of its customers located in Georgia 
  3-34        based upon the activities described in divisions (i) 
  3-35        through (iv) of this subparagraph.  In no event 
  3-36        described in this subparagraph shall such person be 
  3-37        considered to have a fixed place of business in 
  3-38        Georgia at either the commercial printer's premises or 
  3-39        at any place where the commercial printer performs 
  3-40        services on behalf of that person." 
 
 
 
 
 
                                 -3- 
 
 
 
  4- 1                           SECTION 4. 
 
  4- 2  (a) Except as otherwise provided in subsections (b) and (c) 
  4- 3  of this section, this Act shall become effective on July 1, 
  4- 4  1998. 
 
  4- 5  (b) Section 1 of this Act shall become effective January 1, 
  4- 6  1999, and shall be applicable to all taxable years beginning 
  4- 7  on or after that date. 
 
  4- 8  (c) Section 2 of this Act shall become effective July 1, 
  4- 9  1998, and shall be applicable to all taxable years beginning 
  4-10  on or after January 1, 1998. 
 
  4-11                           SECTION 5. 
 
  4-12  All laws and parts of laws in conflict with this Act are 
  4-13  repealed. 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                 -4- 

Clerk of the House
Robert E. Rivers, Jr., Clerk
Last Updated on 04/20/98

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