H. B. 4007
(By Mr. Speaker, Mr. Kiss, and Delegate Ashley)
[By Request of the Executive]
[Introduced January 14, 1998; referred to the
Committee on Finance.]
A BILL to amend and reenact section four-a, article thirteen-c,
chapter eleven of the code of West Virginia, one thousand
nine hundred thirty-one, as amended, relating to the
allowance, determination, computation and application of the
West Virginia corporate headquarters relocation tax credit;
setting forth definitions and effective date; specifying
that on and after the first day of January, one thousand
nine hundred ninety-eight, the suspension set forth in
subsection (a), section fifteen of article thirteen-c
relating to new credit entitlement shall not apply to the
corporate headquarters relocation tax credit allowed under
the section four-a of article thirteen-c.
Be it enacted by the Legislature of West Virginia:
That section four-a, article thirteen-c, chapter eleven of the code of West Virginia, one thousand nine hundred thirty-one,
as amended, be amended and reenacted to read as follows:
ARTICLE 13C. BUSINESS INVESTMENT AND JOBS EXPANSION CREDIT.
§11-13C-4a. Credit allowed for locating corporate headquarters
in this state.
(a)
Credit allowed. -- A corporation that presently has its
corporate headquarters located outside this state that relocates
its corporate headquarters in this state and employs, on a full- time basis, at its new corporate headquarters location, at least
fifteen people, who are domiciled in this state, shall be allowed
credit under this article, the amount of which shall be
determined as provided in subsection (b).
On and after the first
day of January, one thousand nine hundred ninety-eight, the
restrictions set forth in subsection (a), section fifteen of this
article shall not apply to the credit allowed under this section.
However, the restrictions set forth in subsection (a), section
fifteen of this article and the exemptions thereto, set forth in
subsection (b), section fifteen of this article, shall remain
fully applicable and in force for all other tax credits provided
or allowable under this article.
(b)
Determination of credit. -- The amount of credit allowed
by subsection (a) shall be determined at the election of the
taxpayer:
(1) By multiplying its adjusted qualified investment by its
new jobs percentage (as determined under section seven of this
article); or
(2) By multiplying its adjusted qualified investment by ten
percent.
(c)
Application of credit. -- The credit allowed by this
section shall be applied in the manner prescribed in section five
of this article:
Provided, That the amount of corporation net
income taxes against which the credit allowed by this section may
be applied, shall be the sum of the corporation net income tax
due on adjusted federal taxable income allocated to this state
under section seven, article twenty-four of this chapter, plus
that portion of the corporation net income tax due on adjusted
federal taxable income apportioned to this state under section
seven, article twenty-four of this chapter, that is further
apportioned to the qualified investment using the payroll factor
provided in paragraph (1), subsection (h) of said section five.
For all other purposes, the credit allowed by this section shall
be treated as credit allowed by section four of this article.
(d)
Definitions. -- For purposes of this section:
(1)
Adjusted qualified investment. -- The term "adjusted
qualified investment" means the taxpayer's qualified investment
as determined under section six of this article, plus the cost of the reasonable and necessary expenses it incurred to relocate its
corporate headquarters at a location in this state from its
present location outside this state.
(2)
Corporate headquarters. -- The term "corporate
headquarters" means the place at which the corporation has its
commercial domicile and from which the business of the
corporation is primarily conducted.
(3)
Reasonable and necessary expenses incurred to relocate
corporate headquarters. -- The phrase "reasonable and necessary
expenses incurred to relocate corporate headquarters" means only
those expenses incurred and paid by the corporation, to unrelated
third parties, to move its corporate headquarters and its
corporate headquarters employees to this state that are, upon
application by the corporation, determined by the tax
commissioner to have been both reasonable and necessary to
effectuate the move.
(e)
Effective date. -- The credit allowed by this section
shall be allowable for corporate headquarters placed in service
or use on or after the first day of February, one thousand nine
hundred eighty-six.
NOTE: The purpose of this bill is to remove the
restrictions set forth in section 11-13C-15(a) for entitlement to
the West Virginia corporate headquarters relocation tax credit, but to retain those restrictions for the business investment and
jobs expansion tax credit (super credit) and all other tax
credits provided or allowed under article 11-13C and the
exemptions to those restrictions as set forth in section 11-13C- 15(b). Sections 11-13C-15(a) and (b) restrict the availability
of the tax credits under article 11-13C to entities or taxpayers
engaged in the following industries or business activities:
(1) Manufacturing, including, but not limited to, chemical
processing and chemical manufacturing, manufacture of wood
products and forestry products, manufacture of aluminum,
manufacture of paper, paper processing, recyclable paper
processing, food processing, manufacture of aircraft or aircraft
parts, manufacture of automobiles or automobile parts, and all
other manufacturing activities, but not timbering or timber
severance or timber hauling, or mineral severance, hauling,
processing or preparation, or coal severance, hauling, processing
or preparation;
(2) Information processing, including, but not limited to,
telemarketing, information processing, systems engineering,
backoffice operations and software development;
(3) The activity of warehousing, including, but not limited
to, commercial warehousing and the operation of regional
distribution centers by manufacturers, wholesalers or retailers;
(4) The activity of goods distribution; and
(5) Destination-oriented recreation and tourism.
Strike-throughs indicate language that would be stricken
from the present law, and underscoring indicates new language
that would be added.
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