Justia Tax Law Opinion Summaries

The superior court denied the writ of mandamus in this case where a taxpayer requested that a school district to return "excess proceeds" collected pursuant to an educational sales and use tax approved by referendum. In 2001, voters in the Clarke County School District approved a one percent educational sales and use tax (ELOST) for a period of five years beginning immediately upon the expiration of an ELOST that had been approved in 1997. The purpose of the referendum was to provide funds to pay the cost of specified, authorized projects totaling $87,849,000. The total amount of taxes collected pursuant to the 2001 ELOST was $93,413,789, which was $5,564,789 more than the amount of taxes the school district intended to collect, but less than the amount the school district actually spent on the authorized projects. In 2006, voters again approved a one percent ELOST for an additional five years. In spite of these referendums and taxes, as of September 1, 2012, the school district had debt totaling at least $10,855,000. In denying the writ, the superior court found, inter alia, appellant did not show a clear legal right to relief because the school district did not violate the "excess proceeds" provision. The Supreme Court agreed with the superior court and affirmed the lower court's ruling. View "Marsh v. Clarke County Sch. Dist." on Justia Law

Appellant contended that it was a "public utility" under OCGA 48-1-2 and, as such, was required under OCGA 48-5-511 to make an annual tax return of its Georgia property to the Georgia Revenue Commissioner rather than to the Chatham County tax authorities. Appellant filed a complaint for a declaratory judgment and for writ of mandamus in superior court, seeking to have the trial court recognize appellant as a "public utility" and to order appellee to accept appellant's annual ad valorem property tax return. The trial court granted appellee's motion to dismiss the complaint based on appellant's failure to state a claim upon which relief could be granted because the doctrine of sovereign immunity was applicable to the claims. The court reversed and held that it need not address whether sovereign immunity would act as a bar to appellant's declaratory action, as it was clear that, if the declaratory action were barred by sovereign immunity, appellant's mandamus action would still remain viable.

The City of Atlanta ("city"), which required the payment of hotel occupancy taxes pursuant to OCGA 48-13-50 et seq., brought an action against Hotels.com and on-line travel companies (collectively, "OTCs"), which book hotel rooms and make other travel arrangements for customers who access their services over the internet, alleging that the retail room rate was the appropriate amount upon which to base the hotel occupancy tax and seeking injunctive relief, as well as back taxes. At issue was whether the trial court erred when it determined that the "rent" for occupying a city hotel room was the room rate paid by the consumer rather than the negotiated wholesale rate between the OTCs and the hotel; when it issued the injunctive relief; when it voided those portions of the OTCs' contracts which provided that hotel occupancy taxes would be collected and remitted based on the negotiated wholesale rate; and when it held that the city did not have a remedy for back taxes. The court affirmed the trial court and held that the retail room rate was the taxable amount of "rent" under the city's ordinance where the consumer could not obtain the right to occupy the room without paying the retail room rate charged by the OTCs. The court also held that the trial court did not err in issuing its injunctive order where there was no governmental authority in the city, or in the state, that required any OTCs to collect hotel occupancy taxes. The court further held that, because the injunction provided for the proper collection and remittance of the city's hotel occupancy taxes should the OTCs elect to continue to act as third-party tax collectors, the trial court's error in reaching a determination that the contracts at issue were void was improper but the error was effectively moot and provided no basis for removal. The court finally held that the city failed to identify a benefit it had conferred on the OTCs and, accordingly, summary judgment in favor of the OTCs was sustained.