Georgia's Corporate Income Tax
Georgia's Corporate Income Tax rate of 6% has remained unchanged since 1969. Georgia's "Single Factor Gross Receipts" apportionment formula results in a substantial reduction of state income taxes for companies that manufacture products within the state of Georgia, or sell goods or render services from a Georgia base, but sell those products or services to customers in other states. This is designed to encourage manufacturing, distribution and service companies to invest or expand in Georgia.
Georgia Business Tax Incentives for Job Creation and Investment
Job Tax Credit Program: Qualified businesses in Athens-Clarke County can qualify for job tax credits of $4,000 each year for five years for each new full time job created ($20,000 total per job). If a company is unable to utilize all of its credits in a tax year, they may be carried forward for up to ten years or applied to the current year's state employee withholding taxes. Companies can qualify for this credit if they create 5 new full time jobs in a year and are engaged in strategic industries such as manufacturing, warehousing & distribution, processing, telecommunications, broadcasting, tourism, and research and development. In addition, companies whose expansion results in a significant increase in their usage of the Georgia ports, may qualify for an additional $1,250 job tax credit for five years.
Additional credits are available for equipment, capital investments, retraining employees, childcare, R&D, and small business growth companies.
Ad valorem or property tax is the primary source of revenue for local counties and schools in Georgia and a major source of revenue for cities. In Georgia, property is taxed at 40 percent of the fair market value unless otherwise specified by law. Property taxes are determined by multiplying the assessed value (40 percent of the fair market value) by the current millage rate.
For 2011, the millage rate in Clarke County was 33.95 consisting of 20.00 (school millage rate) + 13.70 (net county millage rate) + .25 (state millage rate).
The school and net county millage rate for 2012 will be the same as in 2011. The state millage rate will be reduced by .05, therefore, the millage rate will be 33.90. Downtown areas are 34.90. It adds 1% for the downtown area.
The tax assessors are responsible for the evaluation and appraisal of the property. The evaluation is based on the value of the property on January 1. To read more information about property taxes in Athens-Clarke County click here.
Inventory Tax Exemption (Freeport)
Athens-Clarke County provides a 100% Freeport tax exemption (ad valorem) with annual filing for the following classes of inventory:
- Raw materials and goods in process of manufacture
- Finished goods held by the manufacturer
- Finished goods destined for shipment out-of-state
Industrial Development Revenue Bonds (IDRB)
Tax exempt bond financing is available for companies seeking to finance the purchase of land, buildings and equipment for eligible manufacturing projects. Rates for tax-exempt bonds are market-based and established on the credit and strength of the individual company and projects.
The New Markets Tax Credit (NMTC) Program was established in 2000 as part of the Community Renewal Tax Relief Act of 2000. The goal of the program is to spur revitalization efforts of low-income and impoverished communities across the United States and Territories. The NMTC Program provides tax credit incentives to investors for equity investments in certified Community Development Entities, which invest in low-income communities. The credit equals 39% of the investment paid out (5% in each of the first three years, then 6% in the final four years, for a total of 39%) over seven years (more accurately, six years and one day of the seventh year) . A Community Development Entity must have a primary mission of investing in low-income communities and persons.
New Market Tax Credits can be monetized to serve as an additional cash injection into your project. The Athens-Clarke County Economic Development Department has a team in place to help determine feasibility of the project, source tax credit allocation, and identify New Market Tax Credit investors.
Sales and Use Tax and Exemptions
Athens-Clarke County and State of Georgia Sales Tax total 7%. Georgia Law provides a 100% sales and use tax exemption for qualified purchases including:
- Raw materials
- Goods intended for resale
- Qualified machinery used directly in the manufacture of tangible personal property
- Material handling equipment used in qualified distribution businesses.