senate Bill S3562

2013-2014 Legislative Session

Phases out the franchise tax on business corporations which are manufacturers over a two-year period

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Archive: Last Bill Status - In Committee


  • Introduced
  • In Committee
  • On Floor Calendar
    • Passed Senate
    • Passed Assembly
  • Delivered to Governor
  • Signed/Vetoed by Governor

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Actions

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Assembly Actions - Lowercase
Senate Actions - UPPERCASE
Jan 08, 2014 referred to investigations and government operations
Feb 05, 2013 referred to investigations and government operations

Co-Sponsors

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S3562 - Bill Details

Current Committee:
Law Section:
Tax Law
Laws Affected:
Amd ยงยง208 & 209, Tax L
Versions Introduced in Previous Legislative Sessions:
2011-2012: S4162, S4172
2009-2010: S4102A

S3562 - Bill Texts

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Phases out the franchise tax on business corporations that are manufacturers over a two-year period; defines terms "manufacturer" and "principally engaged".

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BILL NUMBER:S3562

TITLE OF BILL: An act to amend the tax law, in relation to phasing out
the franchise tax on business corporations that are manufacturers

PURPOSE OF BILL: This bill would phase out the corporate franchise tax
over a two-year period on businesses which are manufacturers.

SUMMARY OF SPECIFIC PROVISIONS: Section 1- Amends section 208 of the Tax
Law by adding two new subdivisions 20 and 21 to define the terms
"manufacturer" and "principally engaged."

Section 2 -Amends section 209 of the Tax Law by adding a new subdivision
11 to provide that (a) for any taxable year beginning on or after Janu-
ary 1, 2014, a manufacturer shall be exempt from 50% of the corporate
franchise tax and (b) for any taxable year beginning on or after January
1, 2015, a manufacturer shall be exempt from all of the corporate fran-
chise tax.

Section 3 - Effective date.

JUSTIFICATION: According to the most recent Economic Census information
from the U S Census Bureau , in 2002 there were over 21,000 manufactur-
ers employing more than 541,000 employees in New York State.

The manufacturing industry is an important economic engine that fuels
growth in the communities where manufacturers are located and throughout
the state. Manufacturing companies make goods which, when sold, return
wealth to the communities in which they are located. Recent tax incen-
tive programs and opportunities provided by the State have been focused
on attracting new businesses. However, there are tremendous growth
opportunities within the existing manufacturing base It is hence imper-
ative to implement incentives and tax reductions to continue to attract,
grow, and retain manufacturing business.

This measure would solidify New York State's commitment to its manufac-
turers that have operated, invented, and employed workers in the State

PRIOR LEGISLATIVE HISTORY: 2011-2012 S.4172

FISCAL IMPLICATIONS: Yet to be determined.

EFFECTIVE DATE: This act shall take effect immediately and shall apply
to taxable years commencing on or after January 1, 2013, provided howev-
er that the commissioner of taxation and finance is authorized to
promulgate any and all rules and regulations and take any other measures
necessary for the timely implementation of this act on its effective
date on or before such date.

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                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  3562

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                            February 5, 2013
                               ___________

Introduced  by  Sen.  O'MARA -- read twice and ordered printed, and when
  printed to be committed to the Committee on Investigations and Govern-
  ment Operations

AN ACT to amend the tax law, in relation to phasing  out  the  franchise
  tax on business corporations that are manufacturers

  THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1. Section 208 of the tax law is amended  by  adding  two  new
subdivisions 20 and 21 to read as follows:
  20.    THE  TERM "MANUFACTURER" SHALL MEAN A TAXPAYER WHICH DURING THE
TAXABLE YEAR IS PRINCIPALLY ENGAGED IN THE PRODUCTION OF GOODS BY  MANU-
FACTURING,  PROCESSING,  ASSEMBLING, REFINING, MINING, EXTRACTING, FARM-
ING, AGRICULTURE, HORTICULTURE, FLORICULTURE, VITICULTURE OR  COMMERCIAL
FISHING.  MOREOVER,  FOR  PURPOSES  OF  COMPUTING  THE CAPITAL BASE IN A
COMBINED REPORT, THE GROUP SHALL  BE  CONSIDERED  A  "MANUFACTURER"  FOR
PURPOSES  OF  THIS ARTICLE ONLY IF THE COMBINED GROUP DURING THE TAXABLE
YEAR IS PRINCIPALLY ENGAGED IN THE ACTIVITIES SET FORTH  IN THIS  SUBDI-
VISION, OR ANY COMBINATION THEREOF.
  21.    THE  TERM  "PRINCIPALLY  ENGAGED" SHALL INCLUDE A TAXPAYER OR A
COMBINED GROUP IF, DURING THE TAXABLE YEAR, MORE THAN FIFTY  PERCENT  OF
THE  GROSS RECEIPTS OF THE TAXPAYER OR COMBINED GROUP, RESPECTIVELY, ARE
DERIVED FROM RECEIPTS FROM THE SALE OF GOODS PRODUCED BY  MANUFACTURING.
IN  COMPUTING A COMBINED GROUP'S GROSS RECEIPTS, INTERCORPORATE RECEIPTS
SHALL BE ELIMINATED.
  S 2. Section 209 of the tax law is amended by adding a new subdivision
11 to read as follows:
  11. (A) FOR ANY TAXABLE YEAR BEGINNING ON OR AFTER JANUARY FIRST,  TWO
THOUSAND FOURTEEN, A TAXPAYER WHO IS A MANUFACTURER SHALL BE EXEMPT FROM
FIFTY PERCENT OF ALL TAXES IMPOSED BY THIS ARTICLE.

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD06767-01-3

S. 3562                             2

  (B)  FOR  ANY  TAXABLE  YEAR  BEGINNING ON OR AFTER JANUARY FIRST, TWO
THOUSAND FIFTEEN, A TAXPAYER WHO IS A MANUFACTURER SHALL BE EXEMPT  FROM
ALL TAXES IMPOSED BY THIS ARTICLE.
  S 3. This act shall take effect immediately and shall apply to taxable
years  commencing  on  or after January 1, 2013; provided, however, that
the commissioner of taxation and finance is authorized to promulgate any
and all rules and regulations and take any other measures necessary  for
the timely implementation of this act on its effective date on or before
such date.

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