Ga. Comp. R. & Regs. R. 560-12-2-.116 - Refunds under the Tourism Development Act

(1) Purpose. This Rule addresses the refund of sales tax under the Tourism Development Act ("the Act") as passed in 2013.

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

(a) "Agreement" means an agreement for a Tourism Attraction Project between the Department of Community Affairs and an Approved Company pursuant to O.C.G.A. § 48-8-275.

(b) "Annual Sales and Use Tax" means remitted state sales and use taxes and remitted local sales and use taxes, subject to Paragraph (3)(g), that were generated by sales to the general public at the Approved Tourism Attraction during the calendar year immediately preceding the date of filing the Sales and Use Tax Refund claim.

(c) "Approved Company" means the entity that has submitted an application to undertake a Tourism Attraction Project that has been approved pursuant to O.C.G.A. § 48-8-274. For each Tourism Attraction Project, only one company may be approved under the Act.

(d) "Approved Costs" means:

1. For new Tourism Attractions:

(i) Obligations incurred for labor and to vendors, contractors, subcontractors, builders, suppliers, deliverymen, and materialmen in connection with the acquisition, construction, equipping, and installation of a new Tourism Attraction Project;

(ii) The costs of acquiring real property or rights in real property and any costs incidental thereto;

(iii) All costs for construction materials and equipment installed at the new Tourism Attraction Project;

(iv) The cost of contract bonds and of insurance of all kinds that may be required or necessary during the course of the acquisition, construction, equipping, and installation of a new Tourism Attraction Project which is not paid by the vendor, supplier, deliveryman, or contractor or otherwise provided;

(v) All costs of architectural and engineering services, including but not limited to estimates, plans and specifications, preliminary investigations, and supervision of construction and installation, as well as for the performance of all the duties required by or consequent to the acquisition, construction, equipping, and installation of a new Tourism Attraction Project;

(vi) All costs required to be paid under the terms of any contract for the acquisition, construction, equipping, and installation of a new Tourism Attraction Project;

(vii) All costs required for the installation of utilities, including but not limited to water, sewer, sewage treatment, gas, electricity, communications, and similar facilities; and off-site construction of utility extensions if paid for by the Approved Company; and

(viii) All other costs comparable with those described in this subparagraph; or

2. For existing Tourism Attractions, any Approved Costs otherwise specified in Subparagraph 1 for new Tourism Attractions; provided, however, that such costs are limited to the expansion only of an existing Tourism Attraction and not the renovation of an existing Tourism Attraction.

(e) "Approved Tourism Attraction" means a Project that was approved pursuant to O.C.G.A. § 48-8-274 and that has since opened to the public and become operational as a Tourism Attraction.

(f) "Expansion" means the addition of equipment, facilities, or real estate to an existing Tourism Attraction for the purpose of increasing its size, scope, or visitor capacity.

(g) "Incremental Sales and Use Tax" means remitted state sales and use taxes and remitted local sales and use taxes, subject to Paragraph (3)(g), that were generated by sales to the general public at the Approved Tourism Attraction from the date on which construction of the expansion Project is completed through the end of the calendar year immediately preceding the date of filing the Incremental Sales and Use Tax Refund claim, less the remitted state sales and use taxes and remitted local sales and use taxes, subject to Paragraph (3)(g), that were generated by sales to the general public at the Approved Tourism Attraction during the 12-month period preceding the commencement of construction of the expansion Project that corresponds to the time period for which post-expansion sales tax was collected. Refer to Form ST-12 Tourism for examples demonstrating the calculation of Incremental Sales and Use Tax.

(h) "Incremental Sales and Use Tax Refund" means the amount equal to the lesser of the Incremental Sales and Use Tax or 2.5 percent of the total of all Approved Costs incurred at any time prior to January 1 of the year during which the claim for the Incremental Sales and Use Tax Refund is filed.

(i) "Local Sales and Use Tax" means any sales and use tax, excluding the sales tax for educational purposes levied pursuant to Part 2 of Article 3 of Title 48, Chapter 8 of the Official Code of Georgia and Article VIII, Section VI, Paragraph IV of the Georgia Constitution, that is levied and imposed in an area consisting of less than the entire state, however authorized.

(j) "Renovation" means the restoration, rebuilding, redesign, repair, or replacement of worn elements so that the functionality, quality, or attractiveness of buildings or structures is equivalent to a former state.

(k) "Sales and Use Tax Refund" means the amount equal to the lesser of the Annual Sales and Use Tax or 2.5 percent of the total of all Approved Costs incurred at any time prior to January 1 of the year during which the claim for the Sales and Use Tax Refund is filed.

(l) "State tax incentive" means a tax credit allowed under Chapter 7 of Title 48 or a state sales tax exemption allowed under Chapter 8, Article 1 of Title 48.

(m) "Tourism Attraction" means a cultural or historical site; a recreation or entertainment facility; a convention hotel and conference center; an automobile race track with other tourism amenities; a golf course facility with other tourism amenities; marinas and water parks with lodging and restaurant facilities designed to attract tourists to the State of Georgia; or a Georgia crafts and products center. The term excludes enterprises that are primarily devoted to the retail sale of goods, shopping centers, restaurants, or movie theaters.

(n) "Tourism Attraction Project" or "Project" means the construction or expansion of a Tourism Attraction and includes the real estate acquisition, including the acquisition of real estate by a leasehold interest with a minimum term of 30 years; the construction and equipping of a Tourism Attraction; the construction and installation of improvements to facilities necessary or desirable for the acquisition, construction, and installation of a Tourism Attraction, including but not limited to surveys; installation of utilities, which may include water, sewer, sewage treatment, gas, electricity, communications, and similar facilities; and off-site construction of utility extensions if paid for by the Approved Company. The term does not include the renovation of an existing Tourism Attraction.

(3) Refund claims.

(a) In the discretion of the commissioner of economic development and the commissioner of community affairs, in consideration of the execution of the Agreement and subject to the Approved Company's compliance with the terms of the Agreement, an Approved Company will be granted a Sales and Use Tax Refund for new Projects or an Incremental Sales and Use Tax Refund for expansions of existing Tourism Attractions.

(b) The Approved Company is not obligated to refund or otherwise return any amount of this Sales and Use Tax Refund to the persons from whom the sales and use tax was collected.

(c) The term of the Agreement granting a refund under the Act is ten years, commencing on the date the Tourism Attraction opens for business and begins to collect sales and use taxes or, for an expansion, the date construction is complete.

(d) For each calendar year or partial calendar year occurring during the term of the Agreement, an Approved Company must file with the Department of Revenue a properly completed Claim §for Refund (Form ST-12 Tourism) by March 31 of the following year.

(e) No Sales and Use Tax Refund will be granted to an Approved Company that is during a tax year simultaneously receiving any other state tax incentive associated with any one Tourism Attraction Project. A Sales and Use Tax Refund granted to an Approved Company that is during a tax year simultaneously receiving another state tax incentive is immediately due and payable to the state.

(f) Any Sales and Use Tax Refund will be first applied to any outstanding tax obligation of the Approved Company that is due and payable to the state.

(g) By resolution and at the discretion of the county and city, if any, where the Tourism Attraction Project is to be located, the local sales and use tax may be refunded under the same terms and conditions as any refund of state sales and use taxes.

(h) Interest will not accrue on refunds made under the Tourism Development Act.

(4) Compliance with the terms of the Agreement. Receipt of a refund is conditioned upon compliance with the Agreement between the Approved Company and the commissioner of economic development and the commissioner of community affairs. In the event an Approved Company fails to abide by the terms of the Agreement, then such Agreement is void and all sales and use tax proceeds that were refunded are immediately due and payable to the state.

(5) Transfer of rights, duties, and obligations to successor company. An Approved Company may, in the discretion of the Governor, transfer its rights, duties, and obligations under the Agreement to a successor company if the successor company meets the qualifications of an Approved Company; and, upon such approval by the Governor, such successor Approved Company is authorized to receive the Sales and Use Tax Refunds for the remaining duration of the Agreement if it abides by the terms of the Agreement.

Notes

Ga. Comp. R. & Regs. R. 560-12-2-.116

O.C.G.A. § 48-8-6.

Original Rule entitled "Refunds under the Tourism Development Act" adopted. F. Sep. 10, 2015; eff. Sept. 30, 2015.