PRINTER'S NO. 1045
No. 9 Session of 1999
INTRODUCED BY SAYLOR, BROWNE, MANN, STETLER, WILLIAMS,
McNAUGHTON, BENNINGHOFF, DEMPSEY, HABAY, HUTCHINSON, FARGO,
MAHER, PIPPY, CORRIGAN, MARKOSEK, ALLEN, ARGALL, ARMSTRONG,
BAKER, BARD, BOYES, BUNT, CALTAGIRONE, CAWLEY, CIVERA,
L. I. COHEN, DALLY, FICHTER, FLEAGLE, FORCIER, GEIST, GEORGE,
GLADECK, GODSHALL, GORDNER, HARHART, HASAY, HENNESSEY,
KENNEY, KREBS, MARSICO, MASLAND, McCALL, McGILL, R. MILLER,
NAILOR, ORIE, ROHRER, SAMUELSON, SEMMEL, SEYFERT, SNYDER,
STEELMAN, STERN, STRITTMATTER, E. Z. TAYLOR, TRELLO, TULLI,
YOUNGBLOOD, ZUG AND NICKOL, MARCH 22, 1999
REFERRED TO COMMITTEE ON FINANCE, MARCH 22, 1999
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 use of the sales factor
11 in the apportionment of business income for corporate net
12 income taxation.
13 The General Assembly of the Commonwealth of Pennsylvania
14 hereby enacts as follows:
15 Section 1. Section 401(3)2(a)(9) of the act of March 4, 1971
16 (P.L.6, No.2), known as the Tax Reform Code of 1971, amended
17 June 30, 1995 (P.L.139, No.21), is amended to read:
18 Section 401. Definitions.--The following words, terms, and
19 phrases, when used in this article, shall have the meaning
1 ascribed to them in this section, except where the context
2 clearly indicates a different meaning:
3 * * *
4 (3) "Taxable income." * * *
5 2. In case the entire business of any corporation, other
6 than a corporation engaged in doing business as a regulated
7 investment company as defined by the Internal Revenue Code of
8 1954, as amended, is not transacted within this Commonwealth,
9 the tax imposed by this article shall be based upon such portion
10 of the taxable income of such corporation for the fiscal or
11 calendar year, as defined in subclause 1 hereof, and may be
12 determined as follows:
13 (a) Division of Income.
14 * * *
15 (9) (A) Except as provided in subparagraph (B), all
16 business income shall be apportioned to this State by
17 multiplying the income by [a fraction, the numerator of which is
18 the property factor plus the payroll factor plus twice] the
19 sales factor[, and the denominator of which is four].
20 (B) For purposes of apportionment of the capital stock -
21 franchise tax as provided in section 602 of Article VI of this
22 act, the apportionment fraction shall be the property factor
23 plus the payroll factor plus the sales factor as the numerator,
24 and the denominator shall be three.
25 * * *
26 Section 2. This act shall apply to the tax year beginning on
27 or after January 1, 1999.
28 Section 3. This act shall take effect in 60 days.
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