Georgia Sales and Use Tax
Manufacturing production machinery is exempt from state and local sales tax, as well as machinery or components bought to upgrade or replace existing machinery; additionally, the exemption covers re-manufacturing of aircraft engines and components.

The concept of exempting production machinery has been extended to warehouses and distribution centers; their primary material handling equipment is exempt from sales tax if the company invests $5 million or more in a new or expanded facility.

Computer equipment that is purchased or leased for use at the facilities of a high technology company is exempt when the total purchase (or lease) value exceeds $15 million.

Machinery, equipment and materials purchased and used in a clean room of Class 100 or less are exempt.

Electricity interacting directly with a manufactured product is exempt if the total cost of the electricity is more than half the cost of all materials used (including electricity) in making the product.

Inventory Tax
Many Georgia counties exempt up to 100 percent of inventory of the qualified product of a company from property tax under Georgia’s local-option “freeport” law. Raw material, work-in-process and finished goods inventory can all be exempted in these counties.

In most counties, distribution centers and warehouse inventories are exempt from property taxes if the inventory is destined to be shipped out of the state.

For more information, please contact one of our industry-specific Information Specialists or contact one of our on-the-ground Project Managers. (PDF)