The Clayton County data center tax break actually comes in two pieces: a Georgia sales and use tax exemption on qualifying equipment, and a locally negotiated property tax abatement structured through the Development Authority of Clayton County. Before spending time on either, know this: the Board of Commissioners has paused all new data center applications in unincorporated Clayton County, and in December 2025 extended that moratorium roughly 180 days beyond December 31, 2025, pushing the earliest possible end into late June 2026.1Clayton County Government. Community and Economic Development Until the county lifts the pause and finalizes new zoning rules, permits, rezonings, and licenses for new or expanding data centers are not being accepted.
What the Moratorium Blocks
Resolution 2025-193 halted county acceptance of special land use permits, rezonings, land disturbance permits, building permits, licenses, and certificates of occupancy tied to new or expanding data centers in unincorporated Clayton County.2Clayton County Government. Clayton County Board of Commissioners Approves Moratorium on New Data Centers in Clayton County Resolution 2025-271 then extended that pause for another 180 days from December 31, 2025.1Clayton County Government. Community and Economic Development During the moratorium, the Board is studying the effects of data centers on resident health, safety, and welfare, and the county may adopt new zoning provisions before it reopens the application window.
One boundary matters here. Projects inside incorporated municipalities like Forest Park run through those cities’ own zoning rules and are not necessarily subject to the county-level pause. If your site is inside a city, confirm the local process there. Anywhere else in the county, confirm the moratorium’s current status with county staff before spending on site planning.
Sales and Use Tax Exemption on Equipment
The larger of the two incentives is the state exemption under O.C.G.A. ยง 48-8-3(68.1), which eliminates Georgia sales and use tax on qualifying data center equipment purchased between July 1, 2018, and December 31, 2031.3Justia Law. Georgia Code 48-8-3 – Exemptions For a facility spending hundreds of millions on hardware and infrastructure, the exemption can be worth tens of millions over the life of the build-out.
The statute reads broadly. Eligible property includes servers, routers, switches, and peripheral devices, along with the systems that keep those machines running: backup generators, air handling units, cooling towers, energy storage technology, power distribution units, switchgear, batteries, wiring, cabling, and conduit. The equipment must be used to maintain the facility’s physical or digital environment, protect equipment from threats, or deliver power, cooling, or telecom services to the data center.3Justia Law. Georgia Code 48-8-3 – Exemptions Real property does not qualify, and equipment leased out to a third party more than once cannot be counted toward the investment threshold.
To claim the exemption on purchases, the operator must obtain a certificate from the Georgia Department of Revenue. The Revenue Commissioner will not issue that certificate unless the data center shows it will more likely than not meet the minimum investment threshold.3Justia Law. Georgia Code 48-8-3 – Exemptions Sellers collect ordinary sales tax unless the buyer presents that certificate at purchase.
The Clayton County Investment and Jobs Bar
Georgia scales the minimum investment threshold to county population from the most recent U.S. decennial census.4Georgia Department of Revenue. Data Centers Sales and Use Tax Exemption – Aggregate Expenditures by County Clayton County’s 2020 population of roughly 297,700 places it in the top tier. Within any consecutive seven-year window ending before the December 31, 2031 sunset, a Clayton County data center must hit both of these numbers:
- At least $250 million in aggregate expenditures on facility design, construction, and qualifying equipment.3Justia Law. Georgia Code 48-8-3 – Exemptions
- At least 25 new quality jobs, each 30 or more hours per week and paying at least 110 percent of the county’s average annual wage.5Georgia Department of Audits and Accounts. Tax Incentive Evaluation
Lower thresholds you may see quoted online apply to smaller counties elsewhere in Georgia, not to Clayton. A full-scale campus generally clears the $250 million bar on equipment alone, which is the tier of operator the incentive was written for.
Property Tax Abatement Through Bond for Title
The second incentive is local, and you negotiate it with the Development Authority of Clayton County rather than claim it under a state statute. The usual structure is a bond-for-title deal. The Authority issues industrial development bonds, takes legal title to the project, and leases the property back to the operator. Because a government entity holds title, the property sits outside standard ad valorem taxation during the lease.
In place of taxes, the operator makes payments in lieu of taxes, known as PILOT payments, to the local taxing bodies. The amount and schedule are negotiated. A common approach phases payments up over time: lower amounts during the heavy-investment early years, stepping up annually toward full value by the end of a ten-year lease. How steep the abatement runs depends on how much capital and how many jobs the project brings to the community.
On a large campus, this piece can rival or exceed the sales tax savings. Cutting the property tax bill for the first decade materially reshapes the project’s economics.
Fees to Budget For
The bond-for-title transaction carries costs the applicant must plan for. The Development Authority’s bond financing application makes the applicant responsible for all Authority expenses, including a minimum $35,000 fee for Authority Counsel plus financial advisor costs. Those fees are owed whether or not the bond issue actually closes.6Invest Clayton. Application for Bond Financing
At closing, the Authority collects an issuance fee equal to one-eighth of one percent of the bond’s principal amount. An annual fee at the same rate on outstanding principal is due each year over the life of the bonds, with year one collected at closing.6Invest Clayton. Application for Bond Financing On a $1 billion bond, the issuance fee alone runs $1.25 million.
How to Apply
Applications go to the Development Authority through Invest Clayton, its economic development arm. The package should include the project scope, the tax relief being requested, total anticipated investment, and financial projections validated by a certified public accountant. Plan to provide energy demand estimates, a construction timeline, and a payroll breakdown showing projected roles by salary range.
The Authority then runs a feasibility review. Its board meets on the second Thursday of each month.7Documenters. The Development Authority of Clayton County Board If the board finds the project fits local economic goals, it issues an inducement resolution signaling intent to proceed with the bond transaction. Executing the lease and closing the bond activates the property tax abatement.
The state sales tax exemption is a separate track. The operator applies directly to the Georgia Department of Revenue for the exemption certificate. Two incentives, two administering bodies, two applications.
Annual Reporting and Clawback
Getting the exemption certificate is not the finish line. Georgia requires operators to file annual reports through the Georgia Tax Center covering quality job counts, expenditures, and customer activity.8Georgia Department of Revenue. How to Submit the Data Center Annual Report Within 60 days after the end of the seventh year following the exemption start date, the data center must file a final report listing all expenditures counted toward the threshold and all quality jobs created.3Justia Law. Georgia Code 48-8-3 – Exemptions
The clawback is severe. If the Revenue Commissioner finds the data center failed to meet its investment threshold, the operator must repay every dollar of sales tax exempted or refunded, plus interest running from the original due dates. Repayment is due within 90 days of notification. The Commissioner may also require a surety bond of up to $20 million as a condition of issuing the certificate.3Justia Law. Georgia Code 48-8-3 – Exemptions
The property tax side runs its own compliance check. The Development Authority reviews annual reports comparing actual investment and headcount against the original projections. Missing targets does not automatically wipe out the abatement, but it can trigger additional PILOT payments that erode the savings. The incentives are real, and so are the consequences for taking them and falling short.