Senate Bill No. 446
(By Senators Withers, Macnaughtan and Blatnik)
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[Introduced March 22, 1993; referred to the Committee
on Finance.]
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A BILL to amend and reenact section seven, article thirteen-c,
chapter eleven of the code of West Virginia, one thousand
nine hundred thirty-one, as amended; and to further amend
said article by adding thereto a new section, designated
section fifteen, all relating to business investment and
jobs expansion credit; reducing the new jobs percentage; and
phasing out and terminating the program.
Be it enacted by the Legislature of West Virginia:
That section seven, article thirteen-c, chapter eleven of
the code of West Virginia, one thousand nine hundred thirty-one,
as amended, be amended and reenacted; and that said article be
further amended by adding thereto a new section, designated
section fifteen, all to read as follows:
ARTICLE 13C. BUSINESS INVESTMENT AND JOBS EXPANSION CREDIT.
§11-13C-7. New jobs percentage.
(a) In general. -- The new jobs percentage is based on the
number of new jobs created in this state that are directlyattributable to the qualified investment of the taxpayer.
(b) Applicable percentage. -- For the purpose of subsection
(a), the applicable new jobs percentage shall be determined under
the following table:
If number ofThe applicable
new jobs is:percentage is:
1,00090%
76080%
52070%
28060%
5050%
Provided, That effective the first day of July, one thousand
nine hundred ninety-three, the maximum applicable new jobs
percentage is:
If number of The applicable
new jobs is:percentage is:
10005%
7604%
5203%
2802%
501%
which shall be applicable to all tax credits claimed under this
article after the first day of July, one thousand nine hundred
ninety-three including tax credits for projects certified prior
to the first day of July, one thousand nine hundred ninety-three.
(c) When a job is attributable. -- An employee's position isdirectly attributable to the qualified investment if:
(1) The employee's service is performed or his base of
operations is at the new or expanded business facility;
(2) The position did not exist prior to the construction,
renovation, expansion or acquisition of the business facility
and the making of the qualified investment; and
(3) But for the qualified investment, the position would not
have existed.
(d) Certification of new jobs. -- With the annual return for
the taxes imposed by article twelve-a or thirteen of this
chapter, filed for the taxable year in which the qualified
investment is first placed in service or use in this state, the
taxpayer shall estimate and certify the number of new jobs
reasonably projected to be created by it in this state within the
period prescribed in subsection (f), that are, or will be,
directly attributable to the qualified investment of the
taxpayer: Provided, That on and after the first day of July, one
thousand nine hundred eighty-seven, the phrase "taxes imposed by
article twelve-a or thirteen (or both) of this chapter" shall
mean "taxes imposed by articles thirteen, thirteen-a, thirteen-b,
twenty-one, twenty-three and twenty-four of this chapter (or any
one or combination of such articles of this chapter)."
(e) Equivalency of permanent employees. -- The hours of
part-time employees shall be aggregated to determine the number
of equivalent full-time employees for the purpose of subsection
(b) hereof but not for the purposes of subsection (c) hereof.
(f) Redetermination of new jobs percentage. -- With the
annual return for the taxes imposed by article twenty-one or
twenty-four of this chapter, filed for the third taxable year in
which the qualified investment is in service or use, the taxpayer
shall certify the actual number of new jobs created by it in this
state, that are directly attributable to the qualified investment
of the taxpayer: Provided, That on and after the first day of
July, one thousand nine hundred eighty-seven, the phrase "taxes
imposed by article twelve-a or thirteen (or both) of this
chapter" shall mean "taxes imposed by articles thirteen,
thirteen-a, thirteen-b, twenty-one, twenty-three and twenty-four
of this chapter (or any one or combination of such articles of
this chapter)."
(1) If the actual number of jobs created would result in a
higher new jobs percentage, the credit allowed under this article
shall be redetermined and amended returns filed for the first and
second taxable years that the qualified investment was in service
or use in this state.
(2) If the actual number of jobs created would result in a
lower new jobs percentage, the credit previously allowed under
this article shall be redetermined and amended returns filed for
the first and second taxable years. In applying the amount of
redetermined credit allowable for the two preceding taxable
years, the redetermined credit shall first be applied to the
extent it was originally applied in such prior two years to
personal income taxes, then to corporation net income taxes, thento business franchise taxes, then to telecommunications taxes,
then to severance taxes, then to carrier income taxes and lastly
to business and occupation taxes. Any additional taxes due under
this chapter shall be remitted with the amended returns filed
with the tax commissioner, along with interest, as provided in
section seventeen, article ten of this chapter, and a ten percent
penalty, which may be waived by the tax commissioner if the
taxpayer shows that the overclaimed amount of the new jobs
percentage was due to reasonable cause and not due to willful
neglect.
§11-13C-15. Phase out and termination of article.
(a) On and after the first day of July, one thousand nine
hundred ninety-three, the tax commissioner may not certify any
new projects under the provisions of this article, nor may the
tax commissioner authorize any new tax credits under the
provisions of this article.
(b) When all existing tax credits authorized under this
article have been used or expired and all other activities
required by this article have been completed, the provisions of
this article are terminated and shall be of no further effect.
NOTE: The purpose of this bill is to phase out and
terminate the business investment and jobs expansion credit and
reduce the new jobs percentage used in determining the credit.
Strike-throughs indicate language that would be stricken
from the present law, and underscoring indicates new language
that would be added.
Section fifteen is new; therefore, strike-throughs andunderscoring have been omitted.