HF 2937

as introduced - 82nd Legislature (2001 - 2002) Posted on 12/15/2009 12:00am

  1.1                          A bill for an act 
  1.2             relating to taxation; corporate franchise; phasing-in 
  1.3             apportionment based solely on sales; amending 
  1.4             Minnesota Statutes 2000, section 290.191, subdivision 
  1.5             3; Minnesota Statutes 2001 Supplement, section 
  1.6             290.191, subdivision 2; repealing Minnesota Statutes 
  1.7             2000, section 290.191, subdivision 4. 
  1.8   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.9      Section 1.  Minnesota Statutes 2001 Supplement, section 
  1.10  290.191, subdivision 2, is amended to read: 
  1.11     Subd. 2.  [APPORTIONMENT FORMULA OF GENERAL APPLICATION.] 
  1.12  (a) Except for those trades or businesses required to use a 
  1.13  different formula under subdivision 3 or section 290.36, and for 
  1.14  those trades or businesses that receive permission to use some 
  1.15  other method under section 290.20 or under subdivision 4, a 
  1.16  trade or business required to apportion its net income must 
  1.17  apportion its income to this state on the basis of the 
  1.18  percentage obtained by taking the sum of:  
  1.19     (1) 75 the applicable percent for the taxable year from the 
  1.20  table in paragraph (b) of the percentage which the sales made 
  1.21  within this state in connection with the trade or business 
  1.22  during the tax period are of the total sales wherever made in 
  1.23  connection with the trade or business during the tax period; 
  1.24     (2) 12.5 the applicable percent for the taxable year from 
  1.25  the table in paragraph (b) of the percentage which the total 
  1.26  tangible property used by the taxpayer in this state in 
  2.1   connection with the trade or business during the tax period is 
  2.2   of the total tangible property, wherever located, used by the 
  2.3   taxpayer in connection with the trade or business during the tax 
  2.4   period; and 
  2.5      (3) 12.5 the applicable percent for the taxable year from 
  2.6   the table in paragraph (b) of the percentage which the 
  2.7   taxpayer's total payrolls paid or incurred in this state or paid 
  2.8   in respect to labor performed in this state in connection with 
  2.9   the trade or business during the tax period are of the 
  2.10  taxpayer's total payrolls paid or incurred in connection with 
  2.11  the trade or business during the tax period.  
  2.12     (b) For purposes of paragraph (a), the following 
  2.13  percentages apply for the specified taxable years: 
  2.14     
  2.15  Taxable years   Sales factor  Property factor  Payroll factor
  2.16                  under clause   under clause     under clause
  2.17                     (a)(1)         (a)(2)           (a)(2) 
  2.18   
  2.19  Beginning       78 percent    11 percent       11 percent 
  2.20  after 
  2.21  December 31, 
  2.22  2002, and 
  2.23  before 
  2.24  January 1, 
  2.25  2004 
  2.26   
  2.27  Beginning       82 percent    9 percent        9 percent 
  2.28  after 
  2.29  December 31, 
  2.30  2003, and 
  2.31  before 
  2.32  January 1, 
  2.33  2005 
  2.34   
  2.35  Beginning       87 percent    6.5 percent      6.5 percent
  2.36  after 
  3.1   December 31, 
  3.2   2004, and 
  3.3   before 
  3.4   January 1, 
  3.5   2006 
  3.6    
  3.7   Beginning       93 percent    3.5 percent      3.5 percent 
  3.8   after 
  3.9   December 31, 
  3.10  2005, and 
  3.11  before 
  3.12  January 1, 
  3.13  2007 
  3.14   
  3.15  Beginning       100 percent   0 percent       0 percent 
  3.16  after 
  3.17  December 31, 
  3.18  2006 
  3.19     [EFFECTIVE DATE.] This section is effective for taxable 
  3.20  years beginning after December 31, 2002. 
  3.21     Sec. 2.  Minnesota Statutes 2000, section 290.191, 
  3.22  subdivision 3, is amended to read: 
  3.23     Subd. 3.  [APPORTIONMENT FORMULA FOR FINANCIAL 
  3.24  INSTITUTIONS.] (a) Except for an investment company required to 
  3.25  apportion its income under section 290.36, a financial 
  3.26  institution that is required to apportion its net income must 
  3.27  apportion its net income to this state on the basis of the 
  3.28  percentage obtained by taking the sum of:  
  3.29     (1) 75 the applicable percent for the taxable year from the 
  3.30  table in paragraph (b) of the percentage which the receipts from 
  3.31  within this state in connection with the trade or business 
  3.32  during the tax period are of the total receipts in connection 
  3.33  with the trade or business during the tax period, from wherever 
  3.34  derived; 
  3.35     (2) 12.5 the applicable percent for the taxable year from 
  3.36  the table in paragraph (b) of the percentage which the sum of 
  4.1   the total tangible property used by the taxpayer in this state 
  4.2   and the intangible property owned by the taxpayer and attributed 
  4.3   to this state in connection with the trade or business during 
  4.4   the tax period is of the sum of the total tangible property, 
  4.5   wherever located, used by the taxpayer and the intangible 
  4.6   property owned by the taxpayer and attributed to all states in 
  4.7   connection with the trade or business during the tax period; and 
  4.8      (3) 12.5 the applicable percent for the taxable year from 
  4.9   the table in paragraph (b) of the percentage which the 
  4.10  taxpayer's total payrolls paid or incurred in this state or paid 
  4.11  in respect to labor performed in this state in connection with 
  4.12  the trade or business during the tax period are of the 
  4.13  taxpayer's total payrolls paid or incurred in connection with 
  4.14  the trade or business during the tax period. 
  4.15     (b) For purposes of paragraph (a), the following 
  4.16  percentages apply for the specified taxable years: 
  4.17     
  4.18  Taxable years   Sales factor  Property factor  Payroll factor
  4.19                  under clause   under clause     under clause
  4.20                     (a)(1)         (a)(2)           (a)(2) 
  4.21   
  4.22  Beginning       78 percent    11 percent       11 percent 
  4.23  after 
  4.24  December 31, 
  4.25  2002, and 
  4.26  before 
  4.27  January 1, 
  4.28  2004 
  4.29   
  4.30  Beginning       82 percent    9 percent        9 percent 
  4.31  after 
  4.32  December 31, 
  4.33  2003, and 
  4.34  before 
  4.35  January 1, 
  4.36  2005 
  5.1    
  5.2   Beginning       87 percent    6.5 percent      6.5 percent
  5.3   after 
  5.4   December 31, 
  5.5   2004, and 
  5.6   before 
  5.7   January 1, 
  5.8   2006 
  5.9    
  5.10  Beginning       93 percent    3.5 percent      3.5 percent 
  5.11  after 
  5.12  December 31, 
  5.13  2005, and 
  5.14  before 
  5.15  January 1, 
  5.16  2007 
  5.17   
  5.18  Beginning       100 percent   0 percent       0 percent 
  5.19  after 
  5.20  December 31, 
  5.21  2006 
  5.22     [EFFECTIVE DATE.] This section is effective for taxable 
  5.23  years beginning after December 31, 2002. 
  5.24     Sec. 3.  [REPEALER.] 
  5.25     Minnesota Statutes 2000, section 290.191, subdivision 4, is 
  5.26  repealed. 
  5.27     [EFFECTIVE DATE.] This section is effective for taxable 
  5.28  years beginning after December 31, 2006.