Rule 560-12-2-.20. Competitive Projects of Regional Significance

1. (1) Purpose. This Rule only addresses sales of tangible personal property used for and in the construction of a Competitive Project of Regional Significance.

2. (2) Definitions. For purposes of this Rule only,

   1. (a) "Competitive Project of Regional Significance" (hereinafter "Project") means the location or expansion of some or all of a business enterprise's operations in Georgia where the commissioner of economic development determines that the Project would have a significant regional impact.
   2. (b) "Energy" means natural or artificial gas, oil, gasoline, electricity, solid fuel, wood, waste, ice, steam, water, and other materials necessary and integral for heat, light, power, refrigeration, climate control, processing, or any other use in any phase of the manufacture of tangible personal property.

3. (3) Construction exemption. To qualify for exemption, property must be:

   1. (a) used exclusively for and in the construction of a Project; and
   2. (b) purchased prior to completion of the construction of the Project.

4. (4) Property used exclusively for and in the construction of a Project.

   1. (a) Property used exclusively for and in the construction of a Project excludes:

      1. 1. Property brought onto the construction site, but not used in furtherance of the completion of a Project, such as a wrench used only to repair a worker's personal vehicle or nails that remain in the original store packaging;
      2. 2. Property used for administrative activities on the construction site, such as sales promotion, general office work, credit and collection, purchasing, and clerical work;
      3. 3. Power lines or transformers that bring electricity into the construction site;
      4. 4. Property used for personal comfort or convenience at the construction site, such as portable toilets, food, heaters, and air conditioning units;
      5. 5. Hotel accommodations;
      6. 6. Motor vehicles; and
      7. 7. Property that is owned or possessed by a contractor or a related party after completion of the Project's construction.

   2. (b) Property used exclusively for and in the construction of a Project includes only tangible personal property that:

      1. 1. remains tangible personal property at a Project's location after the completion of construction;
      2. 2. is incorporated into the real property structures at a Project's location; or
      3. 3. is used by contractors for the sole purpose of constructing a Project's real property structures.

   3. (c) Energy.

      1. 1. Energy used in construction. Sales of Energy used for and in the construction of a Project are exempt from all state and local sales and use taxes pursuant to O.C.G.A. § 48-8-3(93), including sales and use taxes for educational purposes.

      2. 2. Energy necessary and integral to manufacturing. Beginning April 19, 2012, manufacturers that qualify as a Project and qualify for the manufacturing exemption in O.C.G.A § 48-8-3.2 are exempt from all state and local sales and use taxes on the sale and use of Energy that is necessary and integral to the manufacture of tangible personal property, except:

         1. (i) Sales and use tax for educational purposes. Energy otherwise exempt under O.C.G.A § 48-8-3.2 is not exempt from the sales and use tax for educational purposes levied pursuant to Part 2 of Article 3 of Chapter 8 and Article VIII, Section VI, Paragraph IV of the Constitution or from local sales and use taxes for educational purposes authorized by or pursuant to local constitutional amendment.
         2. (ii) Energy used to produce electricity. The exemption in O.C.G.A § 48-8-3.2 for the sale and use of Energy that is necessary and integral to the manufacture of tangible personal property does not apply to Energy purchased by a manufacturer that is primarily engaged in producing electricity for resale.
5. (5) Letter of authorization. Following notification from the commissioner of economic development that a Project has been certified, the Department of Revenue may issue a letter of authorization to each location within the Project. Sellers are required to collect sales tax unless they take in good faith a letter of authorization.
6. (6) Expiration of letters of authorization. A letter of authorization expires with respect to a location within a Project when that location commences business operations.
7. (7) Contractor purchases. A Project may authorize contractors to use the letter of authorization to make exempt purchases. By January 31 of each year, a Project must provide to the Department of Revenue a list of all contractors authorized in the previous calendar year and include for each contractor the business name, address, telephone number, and Georgia sales tax number.
8. (8) Contractors' use tax liability. Notwithstanding O.C.G.A. § 48-8-63(b) and (c), contractors will not incur use tax on tangible personal property qualifying for exemption under this Rule that is purchased by or furnished to the contractor, regardless of whether the property retains the character of tangible personal property or becomes incorporated into real property.

Authority: O.C.G.A. §§ 48-2-12, 48-8-2, 48-8-3, 48-8-3.2.

History. Original Rule entitled "Cemeteries and Crematoriums" adopted. F. and eff. June 30, 1965.

Repealed: F. Feb. 17, 2000; eff. Mar. 8, 2000.

Adopted: New Rule entitled "Competitive Projects of Regional Significance" adopted. F. Sep. 18, 2015; eff. Oct. 8, 2015.

Amended: F. May 22, 2026; eff. June 11, 2026.