07 LC 18
6250S
The
House Committee on Ways and Means offers the following substitute to HB
361:
A
BILL TO BE ENTITLED
AN ACT
AN ACT
To
amend Article 2 of Chapter 7 of Title 48 of the Official Code of Georgia
Annotated, relating to imposition, rate, computation, and exemptions regarding
income tax, so as to change certain provisions regarding certain state income
tax credits; to provide for procedures, conditions, and limitations; to provide
an effective date; to provide for applicability; to repeal conflicting laws; and
for other purposes.
BE
IT ENACTED BY THE GENERAL ASSEMBLY OF GEORGIA:
SECTION
1.
Article
2 of Chapter 7 of Title 48 of the Official Code of Georgia Annotated, relating
to imposition, rate, computation, and exemptions regarding income tax, is
amended by revising Code Section 48-7-40.12, relating to the income tax credit
for qualified research expenses, as follows:
"48-7-40.12.
(a)
As used in this Code section, the term:
(1)
'Base amount' means
the product
of a business enterprise´s Georgia taxable net income in the current
taxable year and the average of the ratios of its aggregate qualified research
expenses to Georgia taxable net income for the preceding three taxable years or
0.300, whichever is less
the sum of the
qualified research expenses for the three years in the base period divided by
three. If a business enterprise was not doing business in Georgia during one or
more of the base period tax years, the business enterprise shall include that
year with '0' expenditures when computing the base amount. If a business
enterprise is in Georgia for less than a full year during any tax year in the
base period, the business enterprise shall annualize the qualified research
expenses for that year by multiplying the qualified research expenses by 365 and
dividing the result by the number of days taxable in Georgia; the business
enterprise shall use this annualized amount when computing the base
amount.
(2)
'Base period' means the three taxable years immediately preceding the taxable
year for which the credit is being claimed.
(2)(3)
'Business enterprise' means any business or the headquarters of any such
business which is engaged in manufacturing, warehousing and distribution,
processing, telecommunications, tourism, and research and development
industries. Such term shall not include retail businesses.
(3)(4)
'Qualified research expenses' means qualified research expenses for any business
enterprise as that term is defined in Section 41 of the Internal Revenue Code of
1986, as amended, except that all wages paid and all purchases of services and
supplies must be for research conducted within the State of
Georgia.
(b)
A tax credit is allowed a business enterprise which has qualified research
expenses in Georgia in a taxable year exceeding a base amount, provided that the
business enterprise for the same taxable year claims and is allowed a research
credit under Section 41 of the Internal Revenue Code of 1986, as
amended.
(c)
The tax credit provided in subsection (b) of this Code section shall be
10
6
1/2 percent of the excess
of the
qualified research expenses incurred for the taxable year for which the credit
is being claimed over the base amount
referred to
in said subsection.
(d)
Any unused credit claimed under this Code section may be carried forward ten
years from the close of the taxable year in which the qualified research
expenses were made. The credit taken in any one taxable year shall not exceed 50
percent of the business enterprise´s remaining Georgia net income tax
liability after all other credits have been applied."
SECTION
2.
Said
article is further amended by revising paragraph (1) of subsection (a) of Code
Section 48-7-40.15, relating to the income tax credit for base year port traffic
increases, as follows:
"(1)
'Base year port traffic' means
for tax years
beginning prior to January 1, 2007, the
total amount of net tons, containers, or twenty-foot equivalent units
(TEU´s), of product actually transported by way of a waterborne ship or
vehicle through a port facility during the period from January 1, 1997, through
December 31, 1997
and for all
tax years beginning on or after January 1, 2007, an average of the total amount
of net tons, containers, or twenty-foot equivalent units (TEU's), of product
actually transported by way of a waterborne ship or vehicle through a port
facility for the three taxable years immediately preceding the taxable year for
which the credit under this Code section is claimed and
allowed; provided, however, that in the
event the total amount actually transported during such period was not at least
75 net tons, five containers, or ten twenty-foot equivalent units (TEU´s),
then 'base year port traffic' means 75 net tons, five containers, or ten
twenty-foot equivalent units (TEU´s)."
SECTION
3.
This
Act shall become effective upon its approval by the Governor or upon its
becoming law without such approval and shall be applicable to all taxable years
beginning on or after January 1, 2007.
SECTION
4.
All
laws and parts of laws in conflict with this Act are repealed.