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Georgia’s agricultural sales tax exemption


 Georgia's agricultural exemption, explained.

The sales and use tax exemption for qualified agricultural producers (QAP) in Georgia has been amended.

Who

Qualifying goods and services may only be purchased tax free by QAPs holding a valid GATE Card. To qualify for a GATE Card, a “qualified agricultural producer” must meet one of the following criteria:

  • Own or lease agricultural land or other real property from which $2,500 or more of agricultural products are produced and sold during the year (including payments from government sources)
  • Perform Agricultural Operations and provide $2,500 worth of such services during the year
  • Be in the business of producing long-term agricultural products (i.e., timber, pulpwood, orchard crops) from which there might not be an annual income currently but which have the capacity to generate at least $2,500 in future annual sales
  • Be actively engaged in the production of agricultural products that generate (or will generate) at least $2,500 in annual sales

What

The sales and use tax exemption applies to the following:

  • Agricultural machinery and equipment
  • Agricultural production inputs
  • Energy used in agriculture

Additional information, including examples of activities and products that do and don’t qualify for the exemption, is available in the Georgia Department of Revenue’s Policy Bulletin SUT-2016-01.

Penalties

Misuse of a GATE Card is considered a misdemeanor and is punishable by a fine, imprisonment, or both. According to the policy bulletin, “In addition to the penalty of being liable for and paying the tax himself or herself, dealers that knowingly and willfully fail, neglect, or refuse to collect the tax are guilty of a misdemeanor of a high and aggravated nature.”

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Gail Cole
Avalara Author
Gail Cole
Gail Cole
Avalara Author Gail Cole
Gail began researching and writing about sales tax in 2012 and has been fascinated with it ever since. She has a penchant for uncovering unusual tax facts, and endeavors to make complex sales tax laws more digestible for both experts and laypeople.