Can a private landfill manager exempt machinery and replacement parts used to reduce air or water pollution at municipally owned Georgia landfills?

Plain-English summary

Qualifying pollution-control machinery, equipment, and replacement parts were exempt when the landfill manager purchased, owned, installed, and used them primarily to reduce or eliminate air or water pollution at Georgia landfill facilities.

The operator had to obtain and retain the Department's Form ST-M8 certificate. Missing that documentation could create liability even for otherwise qualifying machinery. The exemption belonged to the ultimate owner of the pollution-control equipment and did not pass to contractors or other third parties.

Common questions

Q: Is any landfill equipment exempt?

A: No. The machinery or part had to be installed at the facility and primarily used to reduce or eliminate air or water pollution.

Q: Could a contractor claim the operator's exemption?

A: No. The ruling limited it to the ultimate owner of the qualifying equipment.

Citations and references

• O.C.G.A. § 48-8-3(36)-(37) -- pollution-control and waste-burning or recycling exemptions
• Ga. Comp. R. & Regs. r. 560-12-2-.87 -- pollution-control exemption and Form ST-M8
• Eimco BSP Services Co. v. Chilivis, 244 S.E.2d 829 (Ga. 1978) -- installation requirement

Source

• Landing page: Georgia Sales & Use Tax Letter Rulings
• Original PDF: LR SUT-2013-15

Original ruling text

State of Georgia
Douglas J. MacGinnitie
Commissioner

Department of Revenue

Frank M. O’Connell
Director

Administrative Division – Office of Tax Policy
Suite 15107
1800 Century Blvd.
Atlanta, Georgia 30345-3205
(404) 417-6649

June 18, 2013

Georgia Letter Ruling SUT No. 2013-06-18-01 Water Treatment
This letter is in response to your request for guidance on the sales tax consequences of purchases
of machinery and equipment involved in waste management.
Facts
Taxpayer partners with municipalities to design, construct and manage solid waste landfills in
Georgia. The municipality owns the landfill and fulfills all zoning and permitting requirements.
Taxpayer contracts with the municipalities to manage the landfills after construction for the life
of the landfill. In addition, Taxpayer provides waste collection and disposal services throughout
Georgia. Taxpayer does not recover gas from its landfill operations in Georgia to sell to
customers, nor does Taxpayer use burning as part of its landfill management services.
Issue
Do the materials and/or equipment purchased by Taxpayer to construct and/or operate a solid
waste disposal landfill qualify for the exemption from Georgia sales and use tax for machinery
and equipment primarily used for the reduction or elimination of air or water pollution?
Analysis
Georgia levies and imposes a tax (subject to certain exemptions) on the retail purchase, retail
sale, storage, use, or consumption of tangible personal property and on certain enumerated
services.1 Every purchaser of tangible personal property at retail in Georgia is liable for tax on
the purchase at a rate of 4 percent of the sales price of the purchase plus any applicable local
sales taxes. The dealer making the taxable sale must collect the tax from the purchaser and remit
the tax to the Department.2 Thus, unless a specific exemption applies, the sale/purchase of
tangible personal property is subject to tax.

1
2

O.C.G.A. §§ 48-8-1 and 48-8-30(a).
O.C.G.A. § 48-8-30(b)(1).
An Equal Opportunity Employer

June 18, 2013
Page 2 of 2

The sale of machinery and equipment that is primarily used for reducing or eliminating air or
water pollution is exempt from Georgia sales and use tax.3 Machinery or equipment that is
bought to replace or upgrade existing exempt machinery or equipment is likewise exempt.4 In
order to qualify for this exemption, the machinery, equipment, or replacement parts must be
installed into taxpayer’s facilities.5 A similar exemption exists for machinery and equipment
used to burn or recycle wasteful industrial materials that contribute to air or water pollution.6
A purchaser of exempt pollution control machinery must obtain a certificate of exemption (Form
ST-M8) from the Commissioner of the Georgia Department of Revenue, certifying that the
purchaser is entitled to the pollution control tax exemption.7 Failure to obtain and retain this
documentation can create future sales tax liability regardless of the machinery’s tax-exempt
status.8 The exemption is limited to the ultimate owner of the pollution control machinery and
does not extend to contractors or other third parties.9
Ruling
Machinery, equipment, and replacement parts that reduce or eliminate air or water pollution are
exempt from the tax when purchased, owned, and used by Taxpayer to manage and operate solid
waste landfills in Georgia and the purchaser has obtained the proper certificate of exemption
(Form ST-M8). Qualifying machinery, equipment, and replacement parts must be installed into
the landfill facilities, and must be certified as exempt by the Department of Revenue.
The opinions expressed in this ruling are based upon the information contained in your request
and are limited to the specific transactions, facts, circumstances, and taxpayer in question.
Should any circumstances regarding the transactions change or differ materially in any manner
than originally represented, then this ruling may become invalid. In addition, please be advised
that any subsequent statutory or administrative rule changes or judicial interpretations of the
Statutes or Rules upon which this advice is based may subject similar future transactions to a
different tax treatment than those expressed in this response.

3

O.C.G.A. § 48-8-3(36)(A).
Id.
5
Ga. Comp. R. & Regs. r. 560-12-2-.87 and Eimco BSP Services Company v. Chilivis, 244 SE.2d 829 (Ga. 1978).
6
O.C.G.A. § 48-8-3(37).
7
Ga. Comp. R. & Regs. r. 560-12-2-.87.
8
O.C.G.A. § 48-8-38; § 48-8-42; Ga. Comp. R. & Regs. r. 560-12-1-.08(1).
9
Ga. Comp. R. & Regs. r. 560-12-2-.87(4)(6)(a)(7).
4

An Equal Opportunity Employer