2014 -- H 7034 | |
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LC003067 | |
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STATE OF RHODE ISLAND | |
IN GENERAL ASSEMBLY | |
JANUARY SESSION, A.D. 2014 | |
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A N A C T | |
RELATING TO TAXATION - FRANCHISE TAX | |
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Introduced By: Representative Donna M.Walsh | |
Date Introduced: January 09, 2014 | |
Referred To: House Finance | |
It is enacted by the General Assembly as follows: | |
1 | SECTION 1. Section 44-12-1 of the General Laws in Chapter 44-12 entitled "Franchise |
2 | Tax" is hereby amended to read as follows: |
3 | 44-12-1. Tax imposed -- Corporations liable -- Credit for tax on income -- Reduced |
4 | rate where no business done. -- (a) Every corporation, joint-stock company, or association |
5 | incorporated in this state or qualified to do business in this state, whether or not doing business |
6 | for profit, all referred to in this section under the term "corporation", except those enumerated in |
7 | section 44-12-11, shall pay an annual franchise tax to the state upon its authorized capital stock of |
8 | two dollars fifty cents ($2.50) for each ten thousand dollars ($10,000) or fractional part, or the |
9 | sum of five hundred dollars ($500), whichever is greater; reduced however, by a credit, not to |
10 | exceed four hundred dollars ($400), of one hundred dollars ($100) for each employee of such |
11 | entity as of the last day of its preceding tax year. |
12 | (b) In the case of corporations liable to a tax under chapter 11 of this title, only the |
13 | amount by which the franchise tax exceeds the tax payable under that chapter shall be assessed. |
14 | (c) If a corporation shall show by supplemental affidavit attached to the prescribed return |
15 | and signed in the manner provided for each return that it has not, at any time during its preceding |
16 | taxable year, been engaged within the state in any business activities, it shall only pay an annual |
17 | franchise tax upon its authorized capital stock at the following rates: five hundred dollars ($500) |
18 | where the stock does not exceed one million dollars ($1,000,000); and the further sum of twelve |
19 | dollars fifty cents ($12.50) for each additional one million dollars ($1,000,000) or fractional part |
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1 | of the stock. |
2 | (d) Notwithstanding any other provisions of this section or the general or public laws to |
3 | the contrary, no entity liable for the tax set forth in this section shall be required to pay such tax |
4 | for the tax year in which it was formed, or for the two (2) tax years immediately following. |
5 | SECTION 2. This act shall take effect upon passage. |
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EXPLANATION | |
BY THE LEGISLATIVE COUNCIL | |
OF | |
A N A C T | |
RELATING TO TAXATION - FRANCHISE TAX | |
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1 | This act would provide each corporation with a credit against the franchise tax, not to |
2 | exceed four hundred dollars ($400), of one hundred dollars ($100) for each employee of such |
3 | entity as of the last day of its preceding tax year. It would further exempt any corporation from |
4 | the payment of the franchise tax in the first three (3) years of its incorporation. |
5 | This act would take effect upon passage. |
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