SF 1166

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; increasing the credit for 
  1.3             research in the health care provider tax; increasing 
  1.4             the cigarette tax and providing for use of the 
  1.5             proceeds; amending Minnesota Statutes 2000, sections 
  1.6             295.53, subdivision 4a; 297F.05, subdivision 1; 
  1.7             297F.08, subdivision 7; and 297F.10, subdivision 1. 
  1.8   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.9      Section 1.  Minnesota Statutes 2000, section 295.53, 
  1.10  subdivision 4a, is amended to read: 
  1.11     Subd. 4a.  [CREDIT FOR RESEARCH.] (a) In addition to the 
  1.12  exemptions allowed under subdivision 1, a hospital or health 
  1.13  care provider may claim an annual credit against the total 
  1.14  amount of tax, if any, the hospital or health care provider owes 
  1.15  for that calendar year under sections 295.50 to 295.57.  The 
  1.16  credit shall equal 2.5 percent of revenues for patient services 
  1.17  used to fund a percentage of expenditures for qualifying 
  1.18  research conducted by an allowable research program as 
  1.19  determined under paragraph (e).  The amount of the credit shall 
  1.20  not exceed the tax liability of the hospital or health care 
  1.21  provider under sections 295.50 to 295.57. 
  1.22     (b) For purposes of this subdivision, the following 
  1.23  requirements apply: 
  1.24     (1) expenditures must be for program costs of qualifying 
  1.25  research conducted by an allowable research program; 
  1.26     (2) an allowable research program must be a formal program 
  2.1   of medical and health care research conducted by an entity which 
  2.2   is exempt under section 501(c)(3) of the Internal Revenue Code 
  2.3   of 1986 or is owned and operated under authority of a 
  2.4   governmental unit; 
  2.5      (3) qualifying research must:  
  2.6      (A) be approved in writing by the governing body of the 
  2.7   hospital or health care provider which is taking the deduction 
  2.8   credit under this subdivision; 
  2.9      (B) have as its purpose the development of new knowledge in 
  2.10  basic or applied science relating to the diagnosis and treatment 
  2.11  of conditions affecting the human body; 
  2.12     (C) be subject to review by individuals with expertise in 
  2.13  the subject matter of the proposed study but who have no 
  2.14  financial interest in the proposed study and are not involved in 
  2.15  the conduct of the proposed study; and 
  2.16     (D) be subject to review and supervision by an 
  2.17  institutional review board operating in conformity with federal 
  2.18  regulations if the research involves human subjects or an 
  2.19  institutional animal care and use committee operating in 
  2.20  conformity with federal regulations if the research involves 
  2.21  animal subjects.  Research expenses are not exempt do not 
  2.22  qualify for the credit if the study is a routine evaluation of 
  2.23  health care methods or products used in a particular setting 
  2.24  conducted for the purpose of making a management decision.  
  2.25  Costs of clinical research activities paid directly for the 
  2.26  benefit of an individual patient are excluded from 
  2.27  this exemption credit.  Basic research in fields including 
  2.28  biochemistry, molecular biology, and physiology are also 
  2.29  included if such programs are subject to a peer review process. 
  2.30     (c) No credit shall be allowed under this subdivision for 
  2.31  any revenue received by the hospital or health care provider in 
  2.32  the form of a grant, gift, or otherwise, whether from a 
  2.33  government or nongovernment source, on which the tax liability 
  2.34  under section 295.52 is not imposed to conduct research. 
  2.35     (d) The taxpayer shall apply for the credit under this 
  2.36  section on the annual return under section 295.55, subdivision 5.
  3.1      (e) For research expenses paid in 2001, the credit is equal 
  3.2   to 7.5 percent of the taxpayer's total expenditures for 
  3.3   qualifying research.  Beginning September 1, 2001, if the actual 
  3.4   or estimated amount paid under this section for the calendar 
  3.5   year exceeds $2,500,000 $10,000,000, the commissioner of finance 
  3.6   shall determine the rate of the research credit for the 
  3.7   following calendar year to the nearest one-half percent so that 
  3.8   refunds paid under this section will most closely equal 
  3.9   $2,500,000 $10,000,000.  The commissioner of finance shall 
  3.10  publish in the State Register by October 1 of each year the rate 
  3.11  of the credit for the following calendar year.  A determination 
  3.12  under this section is not subject to the rulemaking provisions 
  3.13  of chapter 14. 
  3.14     [EFFECTIVE DATE.] This section is effective for research 
  3.15  expenses paid in 2001 and thereafter. 
  3.16     Sec. 2.  Minnesota Statutes 2000, section 297F.05, 
  3.17  subdivision 1, is amended to read: 
  3.18     Subdivision 1.  [RATES; CIGARETTES.] A tax is imposed upon 
  3.19  the sale of cigarettes in this state, upon having cigarettes in 
  3.20  possession in this state with intent to sell, upon any person 
  3.21  engaged in business as a distributor, and upon the use or 
  3.22  storage by consumers, at the following rates, subject to the 
  3.23  discount provided in this chapter: 
  3.24     (1) on cigarettes weighing not more than three pounds per 
  3.25  thousand, 24 26 mills on each such cigarette; and 
  3.26     (2) on cigarettes weighing more than three pounds per 
  3.27  thousand, 48 52 mills on each such cigarette. 
  3.28     [EFFECTIVE DATE.] This section is effective July 1, 2001. 
  3.29     Sec. 3.  Minnesota Statutes 2000, section 297F.08, 
  3.30  subdivision 7, is amended to read: 
  3.31     Subd. 7.  [PRICE OF STAMPS.] The commissioner shall sell 
  3.32  stamps to any person licensed as a distributor at a discount of 
  3.33  1.0 percent from the face amount of the stamps for the first 
  3.34  $1,500,000 of such stamps purchased in any fiscal year; and at a 
  3.35  discount of 0.6 0.55 percent on the remainder of such stamps 
  3.36  purchased in any fiscal year.  The commissioner shall not sell 
  4.1   stamps to any other person.  The commissioner may prescribe the 
  4.2   method of shipment of the stamps to the distributor as well as 
  4.3   the quantities of stamps purchased. 
  4.4      [EFFECTIVE DATE.] This section is effective July 1, 2001. 
  4.5      Sec. 4.  Minnesota Statutes 2000, section 297F.10, 
  4.6   subdivision 1, is amended to read: 
  4.7      Subdivision 1.  [TAX AND USE TAX ON CIGARETTES.] Revenue 
  4.8   received from cigarette taxes, as well as related penalties, 
  4.9   interest, license fees, and miscellaneous sources of revenue 
  4.10  shall be deposited by the commissioner in the state treasury and 
  4.11  credited as follows: 
  4.12     (a) first to the general obligation special tax bond debt 
  4.13  service account in each fiscal year the amount required to 
  4.14  increase the balance on hand in the account on each December 1 
  4.15  to an amount equal to the full amount of principal and interest 
  4.16  to come due on all outstanding bonds whose debt service is 
  4.17  payable primarily from the proceeds of the tax to and including 
  4.18  the second following July 1; and 
  4.19     (b) after the requirements of paragraph (a) have been met: 
  4.20     (1) the revenue produced by one mill of the tax on 
  4.21  cigarettes weighing not more than three pounds a thousand and 
  4.22  two mills of the tax on cigarettes weighing more than three 
  4.23  pounds a thousand must be credited to the Minnesota future 
  4.24  resources fund; and 
  4.25     (2) the revenue produced by two mills of the tax on 
  4.26  cigarettes weighing not more that three pounds a thousand and 
  4.27  four mills of the tax on cigarettes weighing more than three 
  4.28  pounds must be credited to the health care access fund; and 
  4.29     (3) the balance of the revenues derived from taxes, 
  4.30  penalties, and interest (under this chapter) and from license 
  4.31  fees and miscellaneous sources of revenue shall be credited to 
  4.32  the general fund. 
  4.33     [EFFECTIVE DATE.] This section is effective for revenues 
  4.34  from taxes imposed after June 30, 2001. 
  4.35     Sec. 5.  [FLOOR STOCKS TAX.] 
  4.36     Subdivision 1.  [CIGARETTES.] (a) A floor stocks tax is 
  5.1   imposed on every person engaged in business in this state as a 
  5.2   distributor, retailer, subjobber, vendor, manufacturer, or 
  5.3   manufacturer's representative of cigarettes, on the stamped 
  5.4   cigarettes and unaffixed stamps in the person's possession or 
  5.5   under the person's control at 12:01 a.m. on July 1, 2001.  The 
  5.6   tax is imposed at the following rates, subject to the discounts 
  5.7   in Minnesota Statutes, section 297F.08, subdivision 7: 
  5.8      (1) on cigarettes weighing not more than three pounds per 
  5.9   thousand, two mills on each cigarette; and 
  5.10     (2) on cigarettes weighing not more than three pounds per 
  5.11  thousand, four mills on each cigarette. 
  5.12     (b) Each distributor, by July 8, 2001, shall file a report 
  5.13  with the commissioner of revenue, in the form the commissioner 
  5.14  prescribes, showing the stamped cigarettes and unaffixed stamps 
  5.15  on hand at 12:01 a.m. on July 1, 2001, and the amount of tax due 
  5.16  on the cigarettes and unaffixed stamps.  The tax imposed by this 
  5.17  section is due and payable by August 1, 2001, and after that 
  5.18  date bears interest as provided in Minnesota Statutes, section 
  5.19  270.75.  Each retailer, subjobber, vendor, manufacturer, or 
  5.20  manufacturer's representative shall file a return with the 
  5.21  commissioner, in the form the commissioner prescribes, showing 
  5.22  the cigarettes on hand at 12:01 a.m. on July 1, 2001, and pay 
  5.23  the tax due on them by August 1, 2001.  Tax not paid by the due 
  5.24  date bears interest as provided in Minnesota Statutes, section 
  5.25  270.75. 
  5.26     Subd. 2.  [AUDIT AND ENFORCEMENT.] The tax imposed by this 
  5.27  section is subject to the audit, assessment, and collection 
  5.28  provisions applicable to the taxes imposed under Minnesota 
  5.29  Statutes, chapter 297F.  The commissioner of revenue shall 
  5.30  deposit the revenue from the tax imposed under this section in 
  5.31  the health care access fund in the state treasury.