PRINTER'S NO. 665
No. 614 Session of 2001
INTRODUCED BY MANN, BROWNE, BOYES, TRELLO, CAPPELLI, HUTCHINSON,
RUBLEY, SAINATO, SAYLOR, STEELMAN, TULLI, VANCE, C. WILLIAMS,
BARRAR, CALTAGIRONE, L. I. COHEN, DALLY, FRANKEL, GEIST,
GORDNER, HALUSKA, HORSEY, JOSEPHS, LEVDANSKY, MARKOSEK,
McCALL, MELIO, S. MILLER, NICKOL, ORIE, RAYMOND, READSHAW,
ROSS, SOLOBAY, STABACK, STEIL, STERN, WALKO, WANSACZ, WILT,
WOJNAROSKI, YUDICHAK AND R. MILLER, FEBRUARY 8, 2001
REFERRED TO COMMITTEE ON FINANCE, FEBRUARY 8, 2001
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 appointment of business
11 income for corporate net income tax purposes.
12 The General Assembly of the Commonwealth of Pennsylvania
13 hereby enacts as follows:
14 Section 1. Section 401(3)2(a)(9) of the act of March 4, 1971
15 (P.L.6, No.2), known as the Tax Reform Code of 1971, amended May
16 12, 1999 (P.L.26, No.4), is amended to read:
17 Section 401. Definitions.--The following words, terms, and
18 phrases, when used in this article, shall have the meaning
19 ascribed to them in this section, except where the context
20 clearly indicates a different meaning:
1 * * *
2 (3) "Taxable income." * * *
3 2. In case the entire business of any corporation, other
4 than a corporation engaged in doing business as a regulated
5 investment company as defined by the Internal Revenue Code of
6 1954, as amended, is not transacted within this Commonwealth,
7 the tax imposed by this article shall be based upon such portion
8 of the taxable income of such corporation for the fiscal or
9 calendar year, as defined in subclause 1 hereof, and may be
10 determined as follows:
11 (a) Division of Income.
12 * * *
13 (9) (A) Except as provided in subparagraph (B): (i) For
14 the tax years beginning after December 31, 2000, and before
15 January 1, 2002, all business income shall be apportioned to
16 this State by multiplying the income by a fraction, the
17 numerator of which is the property factor multiplied by ten
18 plus the payroll factor multiplied by ten plus [three times]
19 the sales factor multiplied by eighty, and the denominator of
20 which is [five.] one hundred.
21 (ii) For tax years beginning after December 31, 2001, all
22 business income shall be apportioned to this State by
23 multiplying the income by the sales factor.
24 (B) For purposes of apportionment of the capital stock -
25 franchise tax as provided in section 602 of Article VI of this
26 act, the apportionment fraction shall be the property factor
27 plus the payroll factor plus the sales factor as the numerator,
28 and the denominator shall be three.
29 * * *
30 Section 2. This act shall apply to taxable years beginning
20010H0614B0665 - 2 -
1 after December 31, 2000.
2 Section 3. This act shall take effect immediately.
A18L72RZ/20010H0614B0665 - 3 -