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HB 459 - Occupation taxes and regulatory fees; amend provisions

Jamieson, Mary Jeanette (22nd)	Royal, A. Richard (164th)	Skipper, Jimmy (137th)
Shanahan, Tom E (10th)	Dix, Scott (76th)	Wiles, John J (34th)

Status Summary	HC:	SPCA	SC:	F&PU	FR:	02/04/99	LA:	04/28/99	Signed by Governor

First Reader Summary

A BILL to amend Article 1 of Chapter 13 of Title 48 of the Official Code of Georgia Annotated, relating to general provisions relative to specific, business, and occupation taxes, so as to change or clarify certain definitions, including definitions for employee, gross receipts, location or office, and regulatory fees; and for other purposes.

Code Sections - 48-13-1/ 48-13-14/ 48-13-15/ 48-13-20/ 48-13-22/ 48-13-26

HB 459                                              HB 459/AP 
 
      H. B. No. 459 (AS PASSED HOUSE AND SENATE) 
      By:  Representatives Jamieson of the 22nd, Royal of the 
      164th, Skipper of the 137th, Shanahan of the 10th, Dix of 
      the 76th and others 
 
                        A BILL TO BE ENTITLED 
                               AN ACT 
 
 
  1- 1  To amend Article 1 of Chapter 13 of Title 48 of the Official 
  1- 2  Code of Georgia Annotated, relating to general provisions 
  1- 3  relative to specific, business, and occupation taxes, so as 
  1- 4  to delete an obsolete definition; to change or clarify 
  1- 5  certain definitions, including definitions for employee, 
  1- 6  gross receipts, location or office, and regulatory fees; to 
  1- 7  provide that owners and operators of bona fide coin operated 
  1- 8  machines, owners and operators of businesses where bona fide 
  1- 9  coin operated amusement machines are available for 
  1-10  commercial use, and certain merchants or dealers as to 
  1-11  certain deliveries in areas zoned for commercial use are not 
  1-12  subject to regulatory fees of local governments; to 
  1-13  authorize local governments to request payment of occupation 
  1-14  taxes for practitioners and accept such payment from 
  1-15  partnerships or corporations composed of practitioners; to 
  1-16  change provisions relating to occupation tax on a business 
  1-17  or practitioner with an office or location in more than one 
  1-18  jurisdiction; to provide for the burden of proof; to change 
  1-19  confidentiality provisions; to provide for reporting 
  1-20  omission of taxpayer identification numbers to the Revenue 
  1-21  Commissioner; to change provisions relating to the time for 
  1-22  paying occupation tax and regulatory fees; to provide that 
  1-23  payment of regulatory fees is a condition precedent for 
  1-24  transacting business or practicing a profession; to provide 
  1-25  for exceptions; to provide that certain practitioners who 
  1-26  commence business on or after July 1 shall receive no 
  1-27  reduction in the amount of occupation tax in certain 
  1-28  circumstances; to change provisions relating to remedies for 
  1-29  failure or refusal to pay occupation taxes and regulatory 
  1-30  fees; to clarify that executions may be issued for any 
  1-31  penalty or interest on such taxes and regulatory fees; to 
  1-32  provide for a civil fine not to exceed $500.00; to remove a 
  1-33  provision relating to criminal prosecution; to provide for 
  1-34  related matters; to repeal conflicting laws; and for other 
  1-35  purposes. 
 
  1-36       BE IT ENACTED BY THE GENERAL ASSEMBLY OF GEORGIA: 
 
 
 
                                 -1- 
 
 
 
  2- 1                           SECTION 1. 
 
  2- 2  Article 1 of Chapter 13 of Title 48 of the Official Code of 
  2- 3  Georgia Annotated, relating to general provisions relative 
  2- 4  to specific, business, and occupation taxes, is amended by 
  2- 5  striking Code Section 48-13-1, relating to a definition of 
  2- 6  "in towns and cities," and inserting in lieu thereof the 
  2- 7  following: 
 
  2- 8    "48-13-1. 
 
  2- 9    As used in this chapter, the term 'in towns or cities' 
  2-10    means within one mile of villages, towns, or cities 
  2-11    Reserved." 
 
  2-12                           SECTION 2. 
 
  2-13  Said article is further amended by striking in their 
  2-14  entirety paragraphs (1.1), (2), (3), and (6) of Code Section 
  2-15  48-13-5, relating to definitions, and inserting in lieu 
  2-16  thereof the following: 
 
  2-17        "(1.1)(A) 'Employee' Except as otherwise provided in 
  2-18        subparagraph (B) of this paragraph, 'employee' means 
  2-19        an individual whose work is performed under the 
  2-20        direction and supervision of the employer and whose 
  2-21        employer withholds FICA, federal income tax, or state 
  2-22        income tax from such individual's compensation or 
  2-23        whose employer issues to such individual for purposes 
  2-24        of documenting compensation a form I.R.S. W-2 but not 
  2-25        a form I.R.S. 1099. 
 
  2-26        (B) An individual who performs work under the 
  2-27        direction and supervision of one business or 
  2-28        practitioner in accordance with the terms of a 
  2-29        contract or agreement with another business which 
  2-30        recruits such individual is an employee of the 
  2-31        business or practitioner which issues to such 
  2-32        individual for purposes of documenting compensation a 
  2-33        form I.R.S. W-2. 
 
  2-34        (2)(A) 'Gross receipts' means total revenue of the 
  2-35        business or practitioner for the period, including 
  2-36        without being limited to the following: 
 
  2-37          (i) Total income without deduction for the cost of 
  2-38          goods sold or expenses incurred; 
 
  2-39          (ii) Gain from trading in stocks, bonds, capital 
  2-40          assets, or instruments of indebtedness; 
 
 
 
                                 -2- 
 
 
 
  3- 1          (iii) Proceeds from commissions on the sale of 
  3- 2          property, goods, or services; 
 
  3- 3          (iv) Proceeds from fees charged for services 
  3- 4          rendered; and 
 
  3- 5          (v) Proceeds from rent, interest, royalty, or 
  3- 6          dividend income. 
 
  3- 7        (B) Gross receipts shall not include the following: 
 
  3- 8          (i) Sales, use, or excise taxes; 
 
  3- 9          (ii) Sales returns, allowances, and discounts; 
 
  3-10          (iii) Interorganizational sales or transfers between 
  3-11          or among the units of a parent-subsidiary controlled 
  3-12          group of corporations, as defined by 26 U.S.C. 
  3-13          Section 1563(a)(1), between or among the units of a 
  3-14          brother-sister controlled group of corporations, as 
  3-15          defined by 26 U.S.C. Section 1563(a)(2), or between 
  3-16          or among wholly owned partnerships or other wholly 
  3-17          owned entities; 
 
  3-18          (iv) Payments made to a subcontractor or an 
  3-19          independent agent for services which contributed to 
  3-20          the gross receipts in issue; 
 
  3-21          (v) Governmental and foundation grants, charitable 
  3-22          contributions, or the interest income derived from 
  3-23          such funds, received by a nonprofit organization 
  3-24          which employs salaried practitioners otherwise 
  3-25          covered by this chapter, if such funds constitute 80 
  3-26          percent or more of the organization's receipts; and 
 
  3-27          (vi) Proceeds from sales to customers outside the 
  3-28          state of goods or services which are delivered to or 
  3-29          received by customers who are outside the state at 
  3-30          the time of delivery or receipt. 
 
  3-31      (3) 'Location or office' shall include any structure or 
  3-32      vehicle where a business, profession, or occupation is 
  3-33      conducted, but shall not include a temporary or 
  3-34      construction work site which serves a single customer or 
  3-35      project or a vehicle used for sales or delivery by a 
  3-36      business or practitioner of a profession or occupation 
  3-37      which has a location or office. The renter's or lessee's 
  3-38      location which is the site of personal property which is 
  3-39      rented or leased from another does not constitute a 
  3-40      location or office for the personal property's owner, 
  3-41      lessor, or the agent of the owner or lessor. The site of 
 
 
                                 -3- 
 
 
 
  4- 1      real property which is rented or leased to another does 
  4- 2      not constitute a location or office for the real 
  4- 3      property's owner, lessor, or the agent of the owner or 
  4- 4      lessor unless the real property's owner, lessor, or the 
  4- 5      agent of the owner or lessor, in addition to showing the 
  4- 6      property to prospective lessees or tenants and 
  4- 7      performing maintenance or repair of the property, 
  4- 8      otherwise conducts the business of renting or leasing 
  4- 9      the real property at such site or otherwise conducts any 
  4-10      other business, profession, or occupation at such site." 
 
  4-11      "(6) 'Regulatory fees' means payments, whether 
  4-12      designated as license fees, permit fees, or by another 
  4-13      name, which are required by a local government as an 
  4-14      exercise of its police power and as a part of or as an 
  4-15      aid to regulation of an occupation, profession, or 
  4-16      business.  The amount of a regulatory fee shall 
  4-17      approximate the reasonable cost of the actual regulatory 
  4-18      activity performed by the local government.  A 
  4-19      regulatory fee may not include an administrative fee or 
  4-20      registration fee.  No local government is authorized to 
  4-21      require any administrative fee, registration fee, or fee 
  4-22      by any other name in connection with a regulatory fee, 
  4-23      except an occupation tax, as defined in paragraph (4) of 
  4-24      this Code section. Regulatory fees do not include 
  4-25      development impact fees as defined by paragraph (8) of 
  4-26      Code Section 36-71-2 or other costs or conditions of 
  4-27      zoning or land development." 
 
  4-28                           SECTION 3. 
 
  4-29  Said article is further amended in Code Section 48-13-9, 
  4-30  relating to regulatory fees, by striking subsection (c) in 
  4-31  its entirety and inserting in lieu thereof the following: 
 
  4-32    "(c) Examples of businesses and practitioners of 
  4-33    professions and occupations which local governments are 
  4-34    not authorized to subject to regulatory fees include, but 
  4-35    are expressly not limited to, the following: 
 
  4-36      (1) Lawyers; 
 
  4-37      (2) Physicians licensed under Chapter 34 of Title 43; 
 
  4-38      (3) Osteopaths licensed under Chapter 34 of Title 43; 
 
  4-39      (4) Chiropractors; 
 
  4-40      (5) Podiatrists; 
 
  4-41      (6) Dentists; 
 
 
                                 -4- 
 
 
 
  5- 1      (7) Optometrists; 
 
  5- 2      (8) Psychologists; 
 
  5- 3      (9) Veterinarians; 
 
  5- 4      (10) Landscape architects; 
 
  5- 5      (11) Land surveyors; 
 
  5- 6      (12) Practitioners of physiotherapy; 
 
  5- 7      (13) Public accountants; 
 
  5- 8      (14) Embalmers; 
 
  5- 9      (15) Funeral directors; 
 
  5-10      (16) Civil, mechanical, hydraulic, or electrical 
  5-11      engineers; 
 
  5-12      (17) Architects; 
 
  5-13      (18) Marriage and family therapists, social workers, and 
  5-14      professional counselors; 
 
  5-15      (19) Dealers of motor vehicles, as defined in paragraph 
  5-16      (1) of Code Section 10-1-622; and 
 
  5-17      (20) Owners or operators of bona fide coin operated 
  5-18      amusement machines, as defined in Code Section 48-17-1, 
  5-19      and owners or operators of businesses where bona fide 
  5-20      coin operated amusement machines are available for 
  5-21      commercial use and play by the public, provided that 
  5-22      such amusement machines have affixed current stickers 
  5-23      showing payment of annual permit fees, in  accordance 
  5-24      with Code Section 48-17-9; 
 
  5-25      (21) Merchants or dealers as defined in Code Section 
  5-26      48-5-354 as to their deliveries to businesses and 
  5-27      practitioners of professions and occupations in areas 
  5-28      zoned for commercial use; and 
 
  5-29      (20)(22) Any other business, profession, or occupation 
  5-30      for which state licensure or registration is required by 
  5-31      state law, unless the state law regulating such 
  5-32      business, profession, or occupation specifically allows 
  5-33      for regulation by local governments." 
 
  5-34                           SECTION 4. 
 
  5-35  Said article is further amended in Code Section 48-13-10, 
  5-36  relating to methods of determining the amount of occupation 
 
 
 
                                 -5- 
 
 
 
  6- 1  tax, by inserting a new subsection to be designated 
  6- 2  subsection (h) to read as follows: 
 
  6- 3    "(h) Notwithstanding any other provision in this article, 
  6- 4    any local government levying an occupation tax is 
  6- 5    authorized to request payment of such occupation tax from 
  6- 6    and accept payment from a partnership, corporation, or 
  6- 7    other business entity composed of practitioners subject to 
  6- 8    the election set out in subsection (g) of this Code 
  6- 9    section for each such practitioner." 
 
  6-10                           SECTION 5. 
 
  6-11  Said article is further amended by striking in its entirety 
  6-12  Code Section 48-13-14, relating to businesses or 
  6-13  practitioners with locations or offices in more than one 
  6-14  jurisdiction, and inserting in lieu thereof the following: 
 
  6-15    "48-13-14. 
 
  6-16    (a) In levying occupation tax upon a business or 
  6-17    practitioner with a location or office situated in more 
  6-18    than one jurisdiction, including businesses or 
  6-19    practitioners with one or more locations or offices in 
  6-20    Georgia and one or more locations outside the state, local 
  6-21    governments which use the criterion described in paragraph 
  6-22    (3) of subsection (a) of Code Section 48-13-10 shall 
  6-23    allocate the gross receipts as defined in paragraph (2) of 
  6-24    Code Section 48-13-5 of the business or practitioner for 
  6-25    occupation tax purposes in accordance with one of the 
  6-26    following methods: 
 
  6-27      (1) Where the business or practitioner can reasonably 
  6-28      allocate the dollar amount of gross receipts of the 
  6-29      business or practitioner can be allocated to one or more 
  6-30      of the locations or offices on the basis of product 
  6-31      manufactured in that location or office or service the 
  6-32      sales or other services provided for compensation in 
  6-33      that location or office, each local government is 
  6-34      authorized to tax the gross receipts generated by the 
  6-35      location or office within the jurisdiction of the local 
  6-36      government; or 
 
  6-37      (2) Where the business or practitioner cannot reasonably 
  6-38      allocate the dollar amount of gross receipts cannot 
  6-39      reasonably be allocated among multiple locations or 
  6-40      offices, the total business or practitioner shall divide 
  6-41      the gross receipts shall be divided reported to all 
  6-42      local governments in this state by the number of 
 
 
 
                                 -6- 
 
 
 
  7- 1      locations or offices of the business or practitioner 
  7- 2      which contributed to the gross receipts reported to any 
  7- 3      local government in this state, and shall allocate an 
  7- 4      equal percentage of the total such gross receipts of the 
  7- 5      business or practitioner shall be allocated to each 
  7- 6      location or office. 
 
  7- 7    (b) In no instance shall the sum of the portions of the 
  7- 8    total gross receipts of a business or practitioner taxed 
  7- 9    by all local governments exceed 100 percent of the total 
  7-10    gross receipts of the business or practitioner. 
 
  7-11    (c) In the event of a dispute between the business or 
  7-12    practitioner and the local government as to the allocation 
  7-13    under this Code section, the business or practitioner 
  7-14    shall have the burden of proof as to the reasonableness of 
  7-15    this allocation. 
 
  7-16    (c)(d) Upon request, businesses or practitioners with a 
  7-17    location or office situated in more than one jurisdiction 
  7-18    shall provide to any local government authorized to levy 
  7-19    an occupation tax upon such business or practitioner the 
  7-20    following: 
 
  7-21      (1) Financial information necessary to allocate the 
  7-22      gross receipts of the business or practitioner; and 
 
  7-23      (2) Information relating to the allocation of the 
  7-24      business's or practitioner's gross receipts by other 
  7-25      local governments. 
 
  7-26    (d)(e) When more than one local government levies 
  7-27    occupation tax on a business or practitioner which has 
  7-28    locations encompassed by more than one local government 
  7-29    and the local governments use different criteria for 
  7-30    taxation in accordance with subsection (a) of Code Section 
  7-31    48-13-10, local governments which use the criterion 
  7-32    described in paragraph (3) of subsection (a) of Code 
  7-33    Section 48-13-10 are not authorized to tax any greater 
  7-34    proportion of the gross receipts than authorized by 
  7-35    subsection (a) of this Code section, and local governments 
  7-36    which use the number of employees as a criterion for 
  7-37    taxation are authorized to tax the number of employees who 
  7-38    are employed within the local government's geographic 
  7-39    jurisdiction.  In the case of an employee who works for 
  7-40    the same business or practitioner in more than one 
  7-41    municipal corporation or county, the municipal corporation 
  7-42    or county in which the employee works for the longest 
  7-43    period of time within the calendar year shall be 
 
 
                                 -7- 
 
 
 
  8- 1    authorized to count the individual as an employee who is 
  8- 2    employed within the local government's geographic 
  8- 3    jurisdiction for purposes of occupation tax." 
 
  8- 4                           SECTION 6. 
 
  8- 5  Said article is further amended by striking in its entirety 
  8- 6  Code Section 48-13-15, relating to confidentiality of 
  8- 7  information, and inserting in lieu thereof the following: 
 
  8- 8    "48-13-15. 
 
  8- 9    (a) Except as provided in subsection (c) of this Code 
  8-10    section, information on gross receipts received by a 
  8-11    business or practitioner of an occupation or profession 
  8-12    provided to a local government by a business or 
  8-13    practitioner of an occupation or profession for the 
  8-14    purpose of determining the amount of occupation tax for 
  8-15    the business or practitioner is confidential and exempt 
  8-16    from inspection or disclosure under Article 4 of Chapter 
  8-17    18 of Title 50. 
 
  8-18    (b) Violation of the confidentiality provision of 
  8-19    subsection (a) of this Code section shall be unlawful and 
  8-20    upon conviction shall be punished as a misdemeanor. 
 
  8-21    (c) Information on gross receipts received by a business 
  8-22    or practitioner of an occupation or profession provided to 
  8-23    a local government by a business or practitioner of an 
  8-24    occupation or profession for the purpose of determining 
  8-25    the amount of occupation tax for the business or 
  8-26    practitioner may be disclosed to the governing authority 
  8-27    of another local government for occupation tax purposes or 
  8-28    pursuant to court order or for the purpose of collection 
  8-29    of occupation tax or prosecution for failure or refusal to 
  8-30    pay occupation tax. 
 
  8-31    (d) In the event a taxpayer completes one or more forms in 
  8-32    order to comply with a local government's ordinance or 
  8-33    resolution imposing either an occupation tax or a 
  8-34    regulatory fee and any such form fails to disclose the 
  8-35    social security number or the appropriate federal or state 
  8-36    taxpayer identification number, or other identification 
  8-37    numbers, if required by the local government, such 
  8-38    omission shall be reported in a timely manner to the state 
  8-39    revenue commissioner." 
 
 
 
 
 
 
                                 -8- 
 
 
 
  9- 1                           SECTION 7. 
 
  9- 2  Said article is further amended by striking in their 
  9- 3  entirety Code Section 48-13-20, relating to time for 
  9- 4  payment, Code Section 48-13-22, relating to the amount of 
  9- 5  tax due from businesses commenced on or after July 1, and 
  9- 6  Code Section 48-13-26, relating to executions and criminal 
  9- 7  prosecution, and inserting in lieu thereof the following: 
 
  9- 8    "48-13-20. 
 
  9- 9    (a) All license fees and business, occupation, and other 
  9-10    taxes imposed or authorized by this chapter, except as 
  9-11    otherwise specifically provided, shall be due and payable 
  9-12    annually on within 30 days following January 1, or such 
  9-13    other date specified in the local government ordinance 
  9-14    imposing the fees and taxes.  In the event that any person 
  9-15    commences business on any date after January 1 in any year 
  9-16    or after the date specified in this Code section or in the 
  9-17    local government ordinance imposing the fees and taxes 
  9-18    tax, the tax shall be due and payable on the date of the 
  9-19    commencement of the business 30 days following the 
  9-20    commencement of the business. 
 
  9-21    (b) Regulatory fees authorized by this chapter shall be 
  9-22    paid before commencing business or the practice of a 
  9-23    profession as a condition precedent for transacting 
  9-24    business, or practicing a profession. 
 
  9-25    (c) Regulatory fees may be paid after commencing business 
  9-26    or the practice of a profession when: 
 
  9-27      (1) The work done or services provided are necessary for 
  9-28      the health or safety of one or more individuals; 
 
  9-29      (2) The work done or services provided have no adverse 
  9-30      effect on any other person; and 
 
  9-31      (3) Regulatory fees are tendered to the local government 
  9-32      within two business days after commencing business or 
  9-33      the practice of a profession." 
 
  9-34    "48-13-22. 
 
  9-35    When any person commences business on or after July 1 in 
  9-36    any year, the business or occupation tax for the remaining 
  9-37    portion of the year shall be 50 percent of the tax imposed 
  9-38    for the entire year, except that (1) local governments 
  9-39    which tax according to the criterion described in 
  9-40    paragraph (3) of subsection (a) of Code Section 48-13-10 
  9-41    are authorized to levy their customary rate on the gross 
 
 
                                 -9- 
 
 
 
 10- 1    receipts of the business or practitioner from the 
 10- 2    commencement of the business; and (2) the administrative 
 10- 3    fee authorized as a component of an occupation tax by 
 10- 4    subsection (e) of Code Section 48-13-10 shall not be 
 10- 5    reduced; and (3) a practitioner of a profession or 
 10- 6    occupation who elects as his or her occupation tax the 
 10- 7    amount described in paragraph (2) of subsection (g) of 
 10- 8    Code Section 48-13-10 shall receive no reduction in such 
 10- 9    amount." 
 
 10-10    "48-13-26. 
 
 10-11    (a) In addition to the other remedies available to the 
 10-12    state, counties, and municipalities for the collection of 
 10-13    special taxes, occupation taxes, and license regulatory 
 10-14    fees due the state, counties, and municipalities from 
 10-15    persons subject to the tax or license fee who fail or 
 10-16    refuse to pay the tax or fee, the officer charged with the 
 10-17    collection of the tax or license fee shall issue 
 10-18    executions against the delinquent taxpayers for any or all 
 10-19    of the following: the amount of the taxes or fees due when 
 10-20    the taxes or fees become due; any penalty imposed by 
 10-21    subsection (a) of Code Section 48-13-21; and any interest 
 10-22    imposed by the local ordinance in accordance with 
 10-23    subsection (b) of Code Section 48-13-21.  The court of 
 10-24    competent jurisdiction for the enforcement of ordinances 
 10-25    of the local government which has levied the tax or 
 10-26    imposed the fee may, if authorized by the local ordinance, 
 10-27    impose a civil fine for failure to pay the occupation tax 
 10-28    or regulatory fee.  Such a civil fine shall not exceed 
 10-29    $500.00 and may be enforced by the contempt power of the 
 10-30    court.  
 
 10-31    (b) The right of the state, counties, and municipalities 
 10-32    to criminally prosecute persons violating the law or a 
 10-33    county or municipal ordinance by failing to pay the 
 10-34    special taxes, occupation taxes, or license fees or by 
 10-35    refusing to register shall be in addition to the remedy of 
 10-36    issuing executions against delinquent taxpayers as 
 10-37    authorized by subsection (a) of this Code section." 
 
 10-38                           SECTION 8. 
 
 10-39  All laws and parts of laws in conflict with this Act are 
 10-40  repealed. 
 
 
 
 
 
 
                                 -10-