HB 814-FN-A - AS INTRODUCED
2003 SESSION
09/10
HOUSE BILL 814-FN-A
AN ACT establishing a credit against the business profits tax for certain insurance, financial services, and health care business organizations.
SPONSORS: Rep. Brady, Coos 2; Rep. Holden, Hills 48; Sen. Gallus, Dist 1
This bill establishes a credit against the business profits tax for certain business organizations with primary business activity in insurance, financial services, or health care sectors.
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Explanation: Matter added to current law appears in bold italics.
Matter removed from current law appears [in brackets and struckthrough.]
Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
03-0887
09/10
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Three
AN ACT establishing a credit against the business profits tax for certain insurance, financial services, and health care business organizations.
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 New Paragraph; Business Profits Tax Credit for Business Organizations in the Insurance, Financial Services, and Health Care Sectors. Amend RSA 77-A:5 by inserting after paragraph XI the following new paragraph:
XII.(a) A credit against taxes owed under this chapter for business organizations with principal business activity in the insurance, financial services, or health care sectors within their first 5 years of operation within this state. The credit shall be calculated against the amount of taxes owed as follows:
(1) For business organizations with 35 to 99 employees, 60 percent credit in the first year the credit is available, with a 10 percent deduction in the percentage credit available for each of the following 4 years.
(2) For business organizations with 100 to 199 employees, 75 percent credit in the first year the credit is available, with a 10 percent deduction in the percentage credit available for each of the following 4 years.
(3) For business organizations with 200 or more employees, 90 percent credit in the first year the credit is available, with a 10 percent deduction in the percentage credit available for each of the following 4 years.
(b) In order to apply toward the credit established in this paragraph, a job shall pay wages at least 1.75 times the federal minimum wage.
2 Effective Date. This act shall take effect July 1, 2003.
LBAO
03-0887
Revised 2/18/03
HB 814 FISCAL NOTE
AN ACT establishing a credit against the business profits tax for certain insurance, financial services, and health care business organizations.
FISCAL IMPACT:
The Department of Revenue indicates this bill will decrease state unrestricted general fund revenues by an indeterminable amount in FY 2004 and each year thereafter. There is no fiscal impact on state, county and local expenditures or county and local revenue.
METHODOLOGY:
The Department states that this bill does not clearly define the industries to be provided this credit, nor does it define "primary business activity", therefore, the Department believes the credit would be subject to substantial dispute. The Department did state however, that assuming Business Profits Tax (BPT) totals of $226 million, $232 million and $244 million in FY 2004 through FY 2006, the credit (decrease in state revenue) generated from this bill would fall into the range in the table below.
Estimated Decrease in BPT ($ in Mil.)
Range
FY Low High
2004 $15.8 $23.7
2005 $14.7 $22.0
2006 $15.2 $20.5
The Department can absorb the cost of the administration of this tax change within their existing budget.