SF 2001

as introduced - 84th Legislature (2005 - 2006) Posted on 12/15/2009 12:00am

A bill for an act
relating to taxation; imposing a tax on the transfer
of certain major league sports franchises; proposing
coding for new law as Minnesota Statutes, chapter 290D.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

new text begin [290D.05] TRANSFER TAX; SALES OF MAJOR SPORTS
FRANCHISES.
new text end

new text begin Subdivision 1. new text end

new text begin Findings. new text end

new text begin The legislature finds that the
state and its political subdivisions have contributed to the
value of major league sports franchises through authorizing and
issuing bonds and authorizing and imposing taxes to fund sports
stadiums and improvements to infrastructure to support them.
The legislature further finds that the people of Minnesota have
contributed to the value of major league sports franchises by
paying food, liquor, lodging, and admissions taxes and by their
loyal support of the teams, including attendance at games,
television viewing, and purchases of sports memorabilia.
Further, the legislature finds that, because of the value
contributed by the state and its people, the sale of a major
league sports franchise located in the state of Minnesota may be
subject to tax by the state.
new text end

new text begin Subd. 2. new text end

new text begin Tax imposed. new text end

new text begin A tax is imposed on the sale or
other disposition of a major league sports team that plays or
has played its home games at a sports stadium constructed with
bonds issued under section 473.581. For purposes of this
section, "sale or other disposition of a major league sports
team" means the sale or disposition of a major league sports
franchise, whether by the sale or other disposition of assets,
partnership shares, or corporate stock. The rate of tax is
seven percent of the gain realized on the sale. For purposes of
this section, "gain realized on the sale" means the gain
determined for federal income tax purposes under section 1001 of
the Internal Revenue Code of 1986, as amended through March 15,
2005.
new text end

new text begin Subd. 3. new text end

new text begin Apportionment. new text end

new text begin The tax imposed under
subdivision 2 is apportioned by multiplying it by the ratio of
the period of time the franchise was held by the taxpayer in
which the team played its home games in the state to the period
of time the franchise was held by the taxpayer.
new text end

new text begin Subd. 4. new text end

new text begin Credit. new text end

new text begin A credit against the tax liability
imposed under this section is allowed equal to the amount of
taxes, if any, imposed on the taxpayer, under chapter 290. The
amount of credit must not exceed the tax liability imposed under
this section.
new text end

new text begin Subd. 5. new text end

new text begin Filing of return; payment of tax. new text end

new text begin The person
who realizes the gain on the sale or other disposition under
subdivision 1 is liable for payment of the tax. For purposes of
this section, "person" includes a partnership, corporation,
individual, or other entity. Within 120 days after the close of
the taxpayer's taxable year, for federal income tax purposes, in
which the sale occurred, the taxpayer shall file a return in the
form and manner required by the commissioner of revenue and pay
the tax due under this section. The return must be
authenticated by the person filing the return or by the person's
agent who is authorized in writing to file the return. The
return must set forth the items and data required to compute the
amount of the net tax liability.
new text end

new text begin Subd. 6. new text end

new text begin Records. new text end

new text begin A person required to file a return and
pay the tax under this section must keep records necessary to
determine the tax imposed under this section and is subject to
the audit and enforcement provisions of chapters 270 and 289A
relating to individual income or corporate franchise taxes, as
applicable.
new text end

new text begin Subd. 7. new text end

new text begin Administration; enforcement. new text end

new text begin The commissioner
of revenue shall administer and enforce the provisions of this
section and has all the powers and duties contained in chapters
270, 289A, and 290, including payment of refunds, that apply to
the individual income or corporate franchise tax, as applicable,
to administer, audit, collect, and enforce the tax imposed under
this section.
new text end

new text begin Subd. 8. new text end

new text begin Penalties; interest. new text end

new text begin (a) Interest is payable to
the commissioner under the provisions of section 289A.55, and
interest must be paid by the commissioner on overpayments under
section 289A.56.
new text end

new text begin (b) The civil penalties provided under section 289A.60 that
apply to individual income or corporate franchise taxes under
chapter 290, as applicable, apply to the tax imposed under this
section.
new text end

new text begin Subd. 9. new text end

new text begin Administrative review. new text end

new text begin The administrative
review provisions of section 289A.65 apply to the tax imposed
under this section.
new text end

new text begin Subd. 10. new text end

new text begin Deposit of proceeds. new text end

new text begin The proceeds of the tax
imposed under this section must be deposited in the state
general fund.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective for sales and
exchanges occurring after March 31, 2005.
new text end