Digital Products Subject to Georgia Sales and Use Tax Effective January 1, 2024

Effective January 1, 2024, sales of specified digital products, other digital goods and digital codes sold to an end user in Georgia are subject to Georgia sales and use tax, provided that the end user receives or will receive the right of permanent use of such products, goods, or codes and the transaction is not conditioned upon continued payment by the end user. The tax will apply regardless of whether possession of the specified digital products, other digital goods or digital codes is maintained by the seller or a third party.

A sale of any specified digital product, other digital good, or digital code will be considered a sale for resale if the item is subsequently sold, licensed, leased, broadcast, transmitted, or distributed, in whole or in part, as an integral, inseparable component part of a service or another such product, good, or code by the purchaser of the item to an ultimate consumer. The purchaser of the item for resale shall maintain records that substantiate the sale for resale.

“Specified digital products” means digital audio-visual works, digital audio works, or digital books.

“Other digital goods” means the following items transferred electronically to an end user:

  • Artwork
  • Photographs
  • Periodicals
  • Newspapers
  • Magazines
  • Video or audio greeting cards
  • Video games or electronic entertainment

Digital code” means a key, activation, or enabling code that conveys a right to obtain one or more specified digital goods or other digital goods. Such term shall not include a code that represents a stored monetary value that is deducted from a total as it is used by the purchaser or a redeemable card, gift card, or gift certificate that entitles the holder to select specified digital goods or other digital goods of an indicated cash value. (Act 236 (S.B. 56), Laws 2023)

Posted on November 13, 2023