PRINTER'S NO. 3133
No. 2491 Session of 1994
INTRODUCED BY BAKER, HASAY, TULLI, MERRY, FICHTER, CARONE, LAUB,
FARMER, TRELLO, RAYMOND, M. N. WRIGHT, HESS, SEMMEL, ROBERTS,
KING, MILLER, SATHER, HUTCHINSON, MASLAND, ALLEN, KENNEY AND
STEELMAN, JANUARY 31, 1994
REFERRED TO COMMITTEE ON FINANCE, JANUARY 31, 1994
AN ACT
1 Amending the act of March 4, 1971 (P.L.6, No.2), entitled "An
2 act relating to tax reform and State taxation by codifying
3 and enumerating certain subjects of taxation and imposing
4 taxes thereon; providing procedures for the payment,
5 collection, administration and enforcement thereof; providing
6 for tax credits in certain cases; conferring powers and
7 imposing duties upon the Department of Revenue, certain
8 employers, fiduciaries, individuals, persons, corporations
9 and other entities; prescribing crimes, offenses and
10 penalties," further providing for the job retention tax
11 credit.
12 The General Assembly of the Commonwealth of Pennsylvania
13 hereby enacts as follows:
14 Section 1. The act of March 4, 1971 (P.L.6, No.2), known as
15 the Tax Reform Code of 1971, is amended by adding an article to
16 read:
17 ARTICLE XXII
18 JOB RETENTION TAX CREDIT
19 Section 2201. Short Title.--This article shall be known and
20 may be cited as the "Job Retention Tax Credit Act."
21 Section 2202. Definitions.--The following words, terms and
1 phrases, when used in this article, shall have the meanings
2 ascribed to them in this section, except where the context
3 clearly indicates a different meaning:
4 "Credit." The Job Retention Tax Credit.
5 "Department." The Department of Revenue of the Commonwealth.
6 "Employer." This term shall have the meaning as prescribed
7 in Article III. In addition, an employer must be engaged in the
8 production of goods by manufacturing, processing, assembling,
9 refining, mining, extracting or research and hire a minimum of
10 one new employe in the year preceding the first year in which
11 the credit is taken.
12 "Manufacturing." The term shall have the meaning as
13 prescribed to it in section 201.
14 "New employe." Any person hired for full-time employment by
15 an employer at the time a new establishment or an expansion of
16 an existing establishment is initially staffed, but does not
17 include any transferred job or existing job. For purposes of
18 this definition, an employe will be considered full-time if he
19 works a minimum of thirty-two hours per week.
20 "Processing." The term shall have the meaning as prescribed
21 to it in section 201.
22 "Research." The term shall have the meaning as prescribed to
23 it in section 201(c)(5).
24 "Secretary." The Secretary of Revenue of the Commonwealth.
25 Section 2203. Authorization of Credit.--Every employer in
26 this Commonwealth shall be entitled to a credit against any of
27 the taxes imposed by Articles II, III, IV and VI and against any
28 payment of estimated taxes or tentative tax due from that
29 employer on account of such taxes.
30 Section 2204. Calculation of Tax Credit.--(a) The amount of
19940H2491B3133 - 2 -
1 a tax credit available to an employer who qualifies for a credit
2 under this article shall be equal to two thousand dollars
3 ($2,000) per new employe hired in the year preceding the first
4 year in which the credit was taken. If an employe was only
5 employed for part of the year in which the credit is taken, the
6 employer shall be eligible for a partial credit which shall be
7 based in a ratio, the numerator of which shall be the number of
8 days the employe was employed by the employer during the tax
9 year, the denominator of which shall be the number of days an
10 employer's business was open during the tax year.
11 (b) An employer shall also be eligible to claim the maximum
12 tax credit of two thousand dollars ($2,000) in the third tax
13 year in which the new employe remains employed by the employer.
14 Except for subsection (c) of this section, no employer shall be
15 eligible to claim a credit for an employe after the third year
16 of employment.
17 (c) The amount of the credit which exceeds the employer's
18 tax liability and cannot be utilized in a given tax year may be
19 carried over for credit against the taxes imposed by Articles
20 II, III, IV and VI for not more than five successive tax years.
21 Section 2205. Procedure.--The department shall establish
22 regulations detailing the requirements and procedures applicable
23 for claiming the credit. The department may also request that
24 the employer submit records and other documents which indicate
25 that the requirements of this act have been satisfied. The total
26 amount of credits which may be approved by the department in any
27 fiscal year shall not exceed fifty million dollars
28 ($50,000,000).
29 Section 2206. Applicability.--This article shall apply to
30 tax years commencing on or after January 1, 1995, and to each
19940H2491B3133 - 3 -
1 tax year thereafter.
2 Section 2. This act shall take effect immediately.
J20L72RZ/19940H2491B3133 - 4 -