2015 -- S 0651 | |
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LC002078 | |
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STATE OF RHODE ISLAND | |
IN GENERAL ASSEMBLY | |
JANUARY SESSION, A.D. 2015 | |
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A N A C T | |
RELATING TO TAXATION - BUSINESS CORPORATION TAX | |
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Introduced By: Senators Goldin, Goodwin, Ruggerio, DaPonte, and Miller | |
Date Introduced: March 11, 2015 | |
Referred To: Senate Finance | |
It is enacted by the General Assembly as follows: | |
1 | SECTION 1. Chapter 44-11 of the General Laws entitled "Business Corporation Tax" is |
2 | hereby amended by adding thereto the following section: |
3 | 44-11-29.2. Notice to tax administrator of sale of controlling interest - Tax due. -- (a) |
4 | The sale or transfer of a controlling interest in any entity for valuable consideration, which |
5 | possesses, directly or indirectly, an interest in real property in this state, shall be fraudulent and |
6 | void as against the state unless the entity shall, within five (5) days after the sale or transfer, |
7 | notify the tax administrator of the sale or transfer and of the price, terms and conditions of the |
8 | sale or transfer, and of the character and location of the assets of the entity. Whenever an entity |
9 | shall make such a sale or transfer, there is imposed on the sale or transfer, payable by the entity |
10 | selling or transferring such controlling interest, a tax at the rate set forth in § 44-25-1(a) on the |
11 | interest in real property possessed, directly or indirectly, by such entity. Whenever an entity shall |
12 | make such a sale or transfer, the tax imposed by this section shall become due and payable at the |
13 | time when the tax administrator is notified, or, if he or she is not notified, at the time when he or |
14 | she should have been notified. |
15 | (b) A taxable sale or transfer of a controlling interest may occur in one transaction or in a |
16 | series of transactions. Transactions which occur within two (2) years of each other are presumed, |
17 | unless shown to the contrary, to be a series of transactions subject to the tax. |
18 | (c) A taxable sale or transfer of a controlling interest may be made by one seller or |
19 | transferor, or may be made by a group of sellers or transferors acting in concert. Sellers or |
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1 | transferors who are related to each other by blood or marriage are presumed, unless shown to the |
2 | contrary, to be acting in concert. |
3 | (d) The tax administrator shall contribute to the distressed community relief program the |
4 | sum as set forth in § 44-25-l(c) to be distributed pursuant to § 45-13-12 and to the housing |
5 | resources commission restricted receipts account the sum as set forth in § 44-25-l(c). Funds will |
6 | be administered by the department of administration, office of housing and community |
7 | development, through the housing resources commission. The state shall retain sixty cents ($.60) |
8 | for state use. The balance of the tax shall be remitted to the municipality in which said real estate |
9 | is located. The tax shall be administered and collected under the provisions of this chapter. |
10 | (e) For the purposes of this section the term "controlling interest" means: |
11 | (1) In the case of a corporation, fifty percent (50%) or more of the total combined voting |
12 | power of all classes of stock of such corporation; or |
13 | (2) In the case of a partnership, association, trust or other entity, fifty percent (50%) or |
14 | more of the capital, profits or beneficial interest in such partnership, association, trust, or other |
15 | entity. |
16 | SECTION 2. This act shall take effect upon passage. |
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LC002078 | |
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EXPLANATION | |
BY THE LEGISLATIVE COUNCIL | |
OF | |
A N A C T | |
RELATING TO TAXATION - BUSINESS CORPORATION TAX | |
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1 | This act would provide that the tax administrator be notified of the sale or transfer of a |
2 | controlling interest in any entity which owns real property in the state, and also imposes a transfer |
3 | tax on the seller of such controlling interest. |
4 | This act would take effect upon passage. |
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