77-E:2-a Automatic Rate Reduction Upon Certified Business Tax Surplus. –
I. In this section:
(a) "Combined business tax revenue" means the total unrestricted revenue received by the state from the business profits tax under RSA 77-A and the business enterprise tax under RSA 77-E for a completed fiscal year, net of refunds, as reported in the audited annual comprehensive financial report.
(b) "Combined business tax plan" means the sum of the final official revenue estimates for the business profits tax and the business enterprise tax as adopted in the biennial operating budget and any revisions enacted in statute prior to the close of the applicable fiscal year.
(c) "Business tax surplus" means the amount, if any, by which combined business tax revenue exceeds the combined business tax plan for the same fiscal year.
II. Not later than December 31 following the close of each fiscal year, the legislative budget assistant, based upon the audited annual comprehensive financial report prepared by the department of administrative services and the official revenue reports issued by the department of revenue administration, shall certify in writing to the governor, the speaker of the house of representatives, the president of the senate, the chairs of the house ways and means, senate ways and means, house finance, and senate finance committees, and the commissioner of the department of revenue administration:
(a) The combined business tax revenue for the completed fiscal year;
(b) The combined business tax plan for the same fiscal year; and
(c) The business tax surplus, if any, calculated under this section.
III. For each full $100,000,000 of business tax surplus certified under paragraph II, and subject to the conditions and floor set forth in paragraphs IV through VI, the rate of tax imposed under RSA 77-E:2 shall be reduced by 0.05 percentage points, effective for taxable periods beginning on or after January 1 of the calendar year immediately following the calendar year in which the certification is issued.
IV. (a) No rate reduction shall take effect under this section if any of the following conditions are true at the close of the applicable fiscal year:
(1) The revenue stabilization reserve account established under RSA 9:13-e is below its statutory cap;
(2) Combined general fund and education trust fund unrestricted revenue for the applicable fiscal year is less than the official revenue plan for those funds; or
(3) Combined business tax revenue for the applicable fiscal year is less than combined business tax revenue for the immediately preceding fiscal year.
(b) If any of these conditions causes a reduction to be suspended, the certified business tax surplus shall carry forward and be applied in the next succeeding fiscal year in which none of these conditions is true.
V. The rate of tax imposed under RSA 77-E:2 shall not be reduced below 0.25 percent by operation of this section. Upon the rate reaching 0.25 percent, this section shall cease to operate, and any further reduction in the rate shall require an affirmative enactment of the general court.
VI. Not later than 60 days following each certification under paragraph II, the commissioner of the department of revenue administration shall publish notice of any rate reduction taking effect under this section and shall issue updated forms and guidance to taxpayers. Required updates to administrative rules shall be exempt from the procedures in RSA 541-A to the extent necessary to give timely effect to a rate reduction under this section.