PRINTER'S NO. 3040
No. 2284 Session of 1998
INTRODUCED BY ROBERTS, JAMES, ORIE, CALTAGIRONE, COY, READSHAW,
LEDERER, WOJNAROSKI, STABACK, CARN, LAUGHLIN, McCALL,
L. I. COHEN, YOUNGBLOOD, DALEY, BOSCOLA, WAUGH, RAMOS,
STEELMAN, COWELL, C. WILLIAMS, THOMAS AND MYERS,
MARCH 11, 1998
REFERRED TO COMMITTEE ON FINANCE, MARCH 11, 1998
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," providing for new business development tax
11 credits.
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 XIX-B
18 NEW BUSINESS DEVELOPMENT TAX CREDIT
19 Section 1901-B. Short Title.--This article shall be known
20 and may be cited as the New Business Tax Credit Act.
21 Section 1902-B. 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 new business development tax credit provided
5 for in this article.
6 "Department." The Department of Community and Economic
7 Development of the Commonwealth.
8 "New business." A person, sole proprietorship, partnership,
9 corporation or other business entity authorized to do business
10 in this Commonwealth and which on the date of application for a
11 credit under this article has been operating for less than one
12 year. The term shall not include a business entity which
13 undergoes a change in form or ownership for the purpose of
14 making application for a credit under this article.
15 "Secretary." The Secretary of Community and Economic
16 Development of the Commonwealth.
17 Section 1903-B. Public Policy.--It is hereby declared to be
18 the public policy of this Commonwealth to encourage the
19 development and vitality of new businesses.
20 Section 1904-B. Tax Credit.--(a) A new business shall
21 submit an application for a credit to the department. If the
22 department determines that the new business is eligible under
23 this article and regulations promulgated by the department, the
24 new business shall receive a tax credit as provided in
25 subsection (b).
26 (b) The Department of Revenue shall grant a tax credit
27 against any tax due under Article III, IV or VI of this act, or
28 any tax substituted in lieu thereof in accordance with the
29 following schedule:
30 Tax Year Following Percentage of Tax Offset
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1 Approval of Credit by Credit
2 First 100 per cent
3 Second 90 per cent
4 Third 80 per cent
5 Fourth 70 per cent
6 Fifth 60 per cent
7 Sixth 50 per cent
8 Seventh 40 per cent
9 Eighth 30 per cent
10 Ninth 20 per cent
11 Tenth 10 per cent
12 (c) After the tenth tax year following approval of a credit,
13 a new business shall not be eligible for any additional credit
14 under this article.
15 Section 1905-B. Rules and Regulations.--The secretary shall
16 promulgate rules and regulations to administer and enforce the
17 provisions of this article.
18 Section 1906-B. Communications to General Assembly.--(a)
19 The secretary shall advise the Appropriations Committee of the
20 Senate and the Appropriations Committee of the House of
21 Representatives in a timely fashion of the amount of funding
22 required to effectively promote and administer the credit
23 provided for in this article.
24 (b) A report shall be delivered by the secretary to the
25 committees of the Senate and the House of Representatives having
26 jurisdiction over the matter of tax credits on the first
27 anniversary of the granting of a credit under this article and
28 every three years thereafter.
29 Section 2. This act shall apply to taxable years beginning
30 after December 31, 1998.
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1 Section 3. This act shall take effect immediately.
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