Bill Text: MS SB2065 | 2014 | Regular Session | Enrolled
Bill Title: Corporation franchise tax law; exclude deferred gains and deferred income from certain computations under.
Spectrum: Partisan Bill (Republican 1-0)
Status: (Passed) 2014-04-23 - Approved by Governor [SB2065 Detail]
Download: Mississippi-2014-SB2065-Enrolled.html
MISSISSIPPI LEGISLATURE
2014 Regular Session
To: Finance
By: Senator(s) Clarke
Senate Bill 2065
(As Sent to Governor)
AN ACT TO AMEND SECTION 27-13-9, MISSISSIPPI CODE OF 1972, TO EXCLUDE DEFERRED GAINS AND DEFERRED INCOME FROM THE COMPUTATION OF CAPITAL, PAID-IN CAPITAL, SURPLUS AND RETAINED EARNINGS FOR PURPOSES OF THE CORPORATION FRANCHISE TAX LAW; TO PROVIDE THAT FOR PURPOSES OF THE CORPORATION FRANCHISE TAX LAW CAPITAL SHALL BE REDUCED BY THE COST OF TREASURY STOCK OF THE CORPORATION REGARDLESS OF WHETHER SUCH STOCK IS PURCHASED WITH THE EARNINGS OF THE CORPORATION; AND FOR RELATED PURPOSES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:
SECTION 1. Section 27-13-9, Mississippi Code of 1972, is amended as follows:
27-13-9. (1) The tax
imposed, levied and assessed, under the provisions of this chapter, shall be
calculated on the basis of the value of the capital employed in this state for
the year preceding the date of filing the return, whether a calendar year, or
fiscal year, except where otherwise provided in this chapter, measured by the
combined issued and outstanding capital stock, paid-in capital, surplus and
retained earnings; provided, that in computing capital, paid-in capital,
surplus and retained earnings, there shall be included deferred taxes, * * * contingent
liabilities and all true reserves, including all reserves other than for
definite known fixed liabilities which do not enhance the value of assets; and
amounts designated for the payment of dividends shall not be excluded from such
calculations until such amounts are definitely and irrevocably placed to the
credit of stockholders, subject to withdrawal on demand; provided, however,
there shall not be included in the value of the capital stock any sums
representing debts, notes, bonds and mortgages due and payable, except where
notes or debts due are provided by an affiliated company as a substitute for
stock or paid-in capital; nor depreciation reserves, bad debt reserves, nor
reserves representing valuation accounts, nor redeemable preference shares
issued by a railroad pursuant to Section 506 of the Railroad Revitalization and
Regulatory Reform Act of 1976, and capital shall be reduced by the cost of
treasury stock of the corporation * * *. In
the case of an association or other organization, except those exempted under
Section 27-13-63, that does not have a capital structure like a corporation,
the tax is based on that organization's accounts that are equivalent to the
aforementioned corporate accounts, or any other capital employed in
Mississippi. There shall not be any exclusion of capital by a corporation
relating to the stock of another corporation except as otherwise provided in
subsection (2). In no case shall the franchise tax so computed be less than
Twenty-five Dollars ($25.00) for the period covering which the return is
filed. In no case shall the determined capital in Mississippi be less than the
assessed value of the real estate and tangible personal property in Mississippi
for the year preceding the year in which the return is due.
(2) In the case of a holding corporation, the value of the capital used, invested or employed in this state shall exclude that portion of the book value of the holding corporation's investment in stock or securities of its subsidiary corporation determined under the following formula: (a) the ratio between (i) the holding corporation's investment in stock or securities of its subsidiary corporation, computed pursuant to regulations promulgated by the commissioner, and (ii) the holding corporation's total assets shall be computed; (b) such ratio then shall be applied to the total capital stock, surplus, undivided profits and true reserves of the holding corporation in order to arrive at the amount of the exclusion.
SECTION 2. This act shall take effect and be in force from and after July 1, 2014.
