Bill Text: NY A06651 | 2019-2020 | General Assembly | Introduced


Bill Title: Eliminates the corporate franchise tax and personal income tax on business corporations that are manufacturers; defines terms "manufacturer" and "principally engaged".

Spectrum: Strong Partisan Bill (Republican 13-1)

Status: (Introduced) 2019-03-14 - referred to ways and means [A06651 Detail]

Download: New_York-2019-A06651-Introduced.html


                STATE OF NEW YORK
        ________________________________________________________________________
                                          6651
                               2019-2020 Regular Sessions
                   IN ASSEMBLY
                                     March 14, 2019
                                       ___________
        Introduced  by  M.  of  A. KOLB, MONTESANO, DiPIETRO, BRABENEC, ASHBY --
          Multi-Sponsored by -- M. of A. BARCLAY,  CROUCH,  FINCH,  FITZPATRICK,
          GIGLIO,  HAWLEY,  McDONOUGH, RAIA, THIELE -- read once and referred to
          the Committee on Ways and Means
        AN ACT to amend the tax law, in relation to  eliminating  the  corporate
          franchise and personal income tax on manufacturers
          The  People of the State of New York, represented in Senate and Assem-
        bly, do enact as follows:
     1    Section 1. Subparagraph 1 of paragraph (b) of subdivision 1 of section
     2  210 of the tax law, as amended by section 18 of part T of chapter 59  of
     3  the laws of 2015, is amended to read as follows:
     4    (1)  [(i)]  The  amount prescribed by this paragraph shall be computed
     5  at .15 percent for each dollar of the taxpayer's total business capital,
     6  or the portion thereof  apportioned  within  the  state  as  hereinafter
     7  provided  for taxable years beginning before January first, two thousand
     8  sixteen. However, in the case of a cooperative  housing  corporation  as
     9  defined  in  the internal revenue code, the applicable rate shall be .04
    10  percent until taxable years beginning on or  after  January  first,  two
    11  thousand  twenty.  The  rate of tax for subsequent tax years shall be as
    12  follows: .125 percent for taxable years beginning on  or  after  January
    13  first,  two  thousand  sixteen  and  before  January first, two thousand
    14  seventeen; .100 percent for taxable years beginning on or after  January
    15  first,  two  thousand  seventeen  and before January first, two thousand
    16  eighteen; .075 percent for taxable years beginning on or  after  January
    17  first,  two  thousand  eighteen  and  before January first, two thousand
    18  nineteen; .050 percent for taxable years beginning on or  after  January
    19  first,  two  thousand  nineteen  and  before January first, two thousand
    20  twenty; .025 percent for taxable years beginning  on  or  after  January
    21  first,  two thousand twenty and before January first, two thousand twen-
    22  ty-one; and zero percent for years beginning on or after January  first,
    23  two  thousand  twenty-one.  The  rate  of  tax  for a qualified New York
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD06104-02-9

        A. 6651                             2
     1  manufacturer shall be .132 percent for taxable  years  beginning  on  or
     2  after  January first, two thousand fifteen and before January first, two
     3  thousand sixteen, .106 percent for taxable years beginning on  or  after
     4  January  first, two thousand sixteen and before January first, two thou-
     5  sand seventeen, .085 percent for taxable years  beginning  on  or  after
     6  January  first,  two  thousand  seventeen  and before January first, two
     7  thousand eighteen; .056 percent for taxable years beginning on or  after
     8  January first, two thousand eighteen and before January first, two thou-
     9  sand nineteen; [.038] and zero percent for taxable years beginning on or
    10  after  January  first,  two thousand nineteen and [before January first,
    11  thousand twenty; .019 percent for taxable years beginning  on  or  after
    12  January  first,  two thousand twenty and before January first, two thou-
    13  sand twenty-one; and zero percent for years beginning on or after  Janu-
    14  ary  first,  two  thousand twenty-one. (ii) In no event shall the amount
    15  prescribed by this paragraph exceed three hundred fifty thousand dollars
    16  for qualified New York manufacturers and for all  other  taxpayers  five
    17  million dollars] thereafter.
    18    §  2. Paragraph (d) of subdivision 1 of section 210 of the tax law, as
    19  amended by section 12 of part A of chapter  59  of  the  laws  of  2014,
    20  subparagraphs  1  and 2 as amended by section 19 of part T of chapter 59
    21  of the laws of 2015, clause (D) as amended by section 2 and clause (D-1)
    22  of subparagraph 1 as added by section 3 of part VV of chapter 59 of  the
    23  laws of 2017, is amended to read as follows:
    24    (d) Fixed dollar minimum.  (1) (A) The amount prescribed by this para-
    25  graph  for  New  York S corporations, other than New York S corporations
    26  that are qualified New York manufacturers or qualified emerging technol-
    27  ogy companies, will be  determined  in  accordance  with  the  following
    28  table:
    29  If New York receipts are:             The fixed dollar minimum tax is:
    30   not more than $100,000                               $   25
    31   more than $100,000 but not over $250,000             $   50
    32   more than $250,000 but not over $500,000             $  175
    33   more than $500,000 but not over $1,000,000           $  300
    34   more than $1,000,000 but not over $5,000,000         $1,000
    35   more than $5,000,000 but not over $25,000,000        $3,000
    36   Over $25,000,000                                     $4,500
    37    (B)  Provided further, the amount prescribed by this paragraph for New
    38  York S corporations  that  are  qualified  New  York  manufacturers,  as
    39  defined  in  subparagraph (vi) of paragraph (a) of this subdivision, and
    40  for New York S  corporations  that  are  qualified  emerging  technology
    41  companies  under  paragraph (c) of subdivision one of section thirty-one
    42  hundred two-e of the  public  authorities  law  regardless  of  the  ten
    43  million  dollar  limitation  expressed in subparagraph one of such para-
    44  graph (c), will be determined in accordance with the following tables.
    45  For taxable years beginning on or after January 1, 2015 and before Janu-
    46  ary 1, 2016:
    47  If New York receipts are:             The fixed dollar minimum tax is:
    48   not more than $100,000                               $   22
    49   more than $100,000 but not over $250,000             $   44
    50   more than $250,000 but not over $500,000             $  153
    51   more than $500,000 but not over $1,000,000           $  263

        A. 6651                             3
     1   more than $1,000,000 but not over $5,000,000         $  877
     2   more than $5,000,000 but not over $25,000,000        $2,631
     3   Over $25,000,000                                     $3,947
     4  For taxable years beginning on or after January 1, 2016 and before Janu-
     5  ary 1, 2018:
     6  If New York receipts are:             The fixed dollar minimum tax is:
     7   not more than $100,000                               $   21
     8   more than $100,000 but not over $250,000             $   42
     9   more than $250,000 but not over $500,000             $  148
    10   more than $500,000 but not over $1,000,000           $  254
    11   more than $1,000,000 but not over $5,000,000         $  846
    12   more than $5,000,000 but not over $25,000,000        $2,538
    13   Over $25,000,000                                     $3,807
    14  For taxable years beginning on or after January 1, 2018 and before Janu-
    15  ary 1, 2019:
    16  If New York receipts are:             The fixed dollar minimum tax is:
    17   not more than $100,000                               $   19
    18   more than $100,000 but not over $250,000             $   38
    19   more than $250,000 but not over $500,000             $  131
    20   more than $500,000 but not over $1,000,000           $  225
    21   more than $1,000,000 but not over $5,000,000         $  750
    22   more than $5,000,000 but not over $25,000,000        $2,250
    23   Over $25,000,000                                     $3,375
    24  For  taxable  years  beginning  on  or  after January 1, 2019, the fixed
    25  dollar minimum tax is $0.
    26    (C) Provided further, the amount prescribed by this  paragraph  for  a
    27  qualified  New  York  manufacturer,  as  defined in subparagraph (vi) of
    28  paragraph (a) of this subdivision, and a qualified  emerging  technology
    29  company  under  paragraph  (c)  of subdivision one of section thirty-one
    30  hundred two-e of the  public  authorities  law  regardless  of  the  ten
    31  million  dollar  limitation  expressed in subparagraph one of such para-
    32  graph (c), that is not a New York S corporation, will be  determined  in
    33  accordance with the following tables. However, with respect to qualified
    34  New  York  manufacturers,  the amounts in these tables will apply in the
    35  case of a combined report only  if  the  combined  group  satisfies  the
    36  requirements  to  be  a  qualified New York manufacturer as set forth in
    37  such subparagraph (vi).
    38  For tax years beginning on or after January 1, 2015 and  before  January
    39  1, 2016:
    40  If New York receipts are:             The fixed dollar minimum tax is:
    41   not more than $100,000                               $   22
    42   more than $100,000 but not over $250,000             $   66
    43   more than $250,000 but not over $500,000             $  153
    44   more than $500,000 but not over $1,000,000           $  439
    45   more than $1,000,000 but not over $5,000,000         $1,316
    46   more than $5,000,000 but not over $25,000,000        $3,070
    47   Over $25,000,000                                     $4,385

        A. 6651                             4
     1  For  tax  years beginning on or after January 1, 2016 and before January
     2  1, 2018:
     3  If New York receipts are:                The fixed dollar minimum tax is:
     4   not more than $100,000                               $   21
     5   more than $100,000 but not over $250,000             $   63
     6   more than $250,000 but not over $500,000             $  148
     7   more than $500,000 but not over $1,000,000           $  423
     8   more than $1,000,000 but not over $5,000,000         $1,269
     9   more than $5,000,000 but not over $25,000,000        $2,961
    10   Over $25,000,000                                     $4,230
    11  For  tax  years beginning on or after January 1, 2018 and before January
    12  1, 2019:
    13  If New York receipts are:             The fixed dollar minimum tax is:
    14   not more than $100,000                               $   19
    15   more than $100,000 but not over $250,000             $   56
    16   more than $250,000 but not over $500,000             $  131
    17   more than $500,000 but not over $1,000,000           $  375
    18   more than $1,000,000 but not over $5,000,000         $1,125
    19   more than $5,000,000 but not over $25,000,000        $2,625
    20   Over $25,000,000                                     $3,750
    21  For tax years beginning on or after January 1, 2019,  the  fixed  dollar
    22  minimum tax is $0.
    23    (D)  Otherwise,  for  all  other taxpayers not covered by clauses (A),
    24  (B), (C) and (D-1) of this subparagraph, the amount prescribed  by  this
    25  paragraph will be determined in accordance with the following table:
    26  If New York receipts are:             The fixed dollar minimum tax is:
    27   not more than $100,000                               $   25
    28   more than $100,000 but not over $250,000             $   75
    29   more than $250,000 but not over $500,000             $  175
    30   more than $500,000 but not over $1,000,000           $  500
    31   more than $1,000,000 but not over $5,000,000         $1,500
    32   more than $5,000,000 but not over $25,000,000        $3,500
    33   more than $25,000,000 but not over $50,000,000       $5,000
    34   more than $50,000,000 but not over $100,000,000      $10,000
    35   more than $100,000,000 but not over $250,000,000     $20,000
    36   more than $250,000,000 but not over $500,000,000     $50,000
    37   more than $500,000,000 but not over $1,000,000,000   $100,000
    38   Over $1,000,000,000                                  $200,000
    39    (D-1)  In  the  case  of a REIT or a RIC that is not a captive REIT or
    40  captive RIC, the amount prescribed by this paragraph will be  determined
    41  in accordance with the following table:
    42  If New York receipts are:             The fixed dollar minimum tax is:
    43   not more than $100,000                               $   25
    44   more than $100,000 but not over $250,000             $   75
    45   more than $250,000 but not over $500,000             $  175
    46   more than $500,000                                   $  500

        A. 6651                             5
     1    (E) For purposes of this paragraph, New York receipts are the receipts
     2  included  in  the numerator of the apportionment factor determined under
     3  section two hundred ten-A for the taxable year.
     4    (2)  If the taxable year is less than twelve months, the amount of New
     5  York receipts is determined by dividing the amount of the  receipts  for
     6  the  taxable year by the number of months in the taxable year and multi-
     7  plying the result by twelve, and the amount prescribed by this paragraph
     8  shall be reduced by twenty-five percent of  the  period  for  which  the
     9  taxpayer  is  subject  to  tax is more than six months but not more than
    10  nine months and by fifty percent if the period for which the taxpayer is
    11  subject to tax is not more than six months. In the case of a termination
    12  year of a New York S corporation, the sum of the tax computed under this
    13  paragraph for the S short year and for the C short  year  shall  not  be
    14  less than the amount computed under this paragraph as if the corporation
    15  were a New York C corporation for the entire taxable year.
    16    §  3.  Subsection  (i)  of  section  601  of the tax law is relettered
    17  subsection (j) and a new subsection (i) is added to read as follows:
    18    (i) Manufacturers. Notwithstanding this or any other section  of  this
    19  article,  a  person's  liability  for  tax  under  this section, if such
    20  person's primary activity is in his or her role as a manufacturer, shall
    21  be zero for taxable years beginning on or after January first, two thou-
    22  sand nineteen. For purposes of this section a person shall be classified
    23  as a manufacturer if, he or she is principally engaged in the production
    24  of goods by manufacturing,  processing,  assembling,  refining,  mining,
    25  extracting,  farming,  agriculture, horticulture, floriculture, viticul-
    26  ture or commercial fishing. In addition, for purposes of  computing  the
    27  capital  base  in  a  combined  report,  the group shall be considered a
    28  manufacturer for purposes of this article, only if  the  combined  group
    29  during  the  taxable  year  is principally engaged in the activities set
    30  forth in this subsection, or any combination thereof.  For  purposes  of
    31  this  subsection,  a  taxpayer is "principally engaged" in the described
    32  activity if, during the taxable year, more than  fifty  percent  of  the
    33  gross receipts of the taxpayer are derived from receipts from activities
    34  covered by this subsection.
    35    §  4.  This act shall take effect immediately; provided, however, that
    36  the commissioner of taxation and finance is authorized to promulgate any
    37  and all rules and regulations and take any other measures necessary  for
    38  the timely implementation of this act on its effective date on or before
    39  such date.
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