Posted on June 1, 2010

Four Georgia sales tax exemptions geared towards reducing expenses for certain nonprofit organizations are set to expire on June 30, 2010. Recently, the Georgia General Assembly decided not to renew a sales tax exemption that allows nonprofit food banks, health centers, volunteer health clinics that serve the poor, and job training organizations for disabled or economically disadvantaged individuals to purchase essential items without paying the 4% sales tax levied on typical consumers.

While most nonprofits have to pay sales tax, in 1951, the Georgia Legislature passed temporary exemptions for certain organizations that serve the poor. However, citing State budget constraints and a poor economy, the Georgia Legislature decided in early May to let many of those exemptions expire.

Nonprofit organizations across Georgia will soon face increased expenses, adding further pressure to already tight budgets. For example, food banks must now either increase their expenditures or reduce the amount of food they purchase to feed the hungry. Similarly, nonprofit health clinics will face increased costs when buying common healthcare items, including: syringes, bandages, wheelchairs, beds, and other essential supplies.