HB 213-FN-A – AS AMENDED BY THE HOUSE
17Mar2011… 0355h
2011 SESSION
09/03
HOUSE BILL 213-FN-A
AN ACT reducing the rate of the business profits tax.
SPONSORS: Rep. W. Smith, Rock 18; Rep. Renzullo, Hills 27; Rep. Rowe, Hills 6; Rep. Cebrowski, Hills 18; Rep. K. Murphy, Hills 18; Rep. Brosseau, Graf 6
This bill reduces the rate of the business profits tax.
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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Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
17Mar2011… 0355h
11-0611
09/03
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Eleven
AN ACT reducing the rate of the business profits tax.
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 Business Profits Tax; Rate Reduced; July 1, 2011. Amend RSA 77-A:2 to read as follows:
77-A:2 Imposition of Tax. A tax is imposed at the rate of [8.5] 8.25 percent upon the taxable business profits of every business organization.
2 Business Profits Tax; Rate Reduced; July 1, 2012. Amend RSA 77-A:2 to read as follows:
77-A:2 Imposition of Tax. A tax is imposed at the rate of [8.25] 8 percent upon the taxable business profits of every business organization.
3 Applicability.
I. Section 1 of this act shall apply to returns and taxes due under RSA 77-A on account of taxable periods ending on or after July 1, 2011.
II. Section 2 of this act shall apply to returns and taxes due under RSA 77-A on account of taxable periods ending on or after July 1, 2012.
4 Effective Date.
I. Section 2 of this act shall take effect July 1, 2012.
II. The remainder of this act shall take effect July 1, 2011.
LBAO
11-0611
Amended 03/30/11
HB 213 FISCAL NOTE
AN ACT reducing the rate of the business profits tax.
FISCAL IMPACT:
The Department of Revenue Administration states this bill, as amended by the House (Amendment #2011-0355h), will decrease state revenue by $9,214,706 in FY 2012, $18,429,412 in FY 2013, and by an indeterminable amount in FY 2014 and each year thereafter. This bill will have no fiscal impact on state, county, and local expenditures, or county and local revenue.
METHODOLOGY:
The Department of Revenue Administration states section 1 of this bill would reduce the Business Profits Tax (BPT) rate from the current 8.5% to 8.25% and would apply to returns and taxes due on account of taxable periods ending on or after July 1, 2011 taking effect July 1, 2011. Section 2 of this bill will subsequently reduce the BPT rate to 8.0% and would apply to returns and taxes due on account of taxable periods ending on or after July 1, 2012, taking effect July 1, 2012. For the purposes of this fiscal note, the Department estimates BPT revenue at $313,300,000 in FY 2012 and 2013, which assumes a taxable base of $3,685,882,353. The Department states a BPT rate of 8.25% would result in revenue of approximately $304,085,294 in FY 2012, a decrease of $9,214,706 compared to the Department’s current FY 2012 estimates. The Department states a BPT rate of 8.0% would result in revenue of approximately $294,870,588, a decrease of $18,429,412 compared to the Department’s current estimates for FY 2013. The Department did not estimate the possible loss of revenue due to the tax rate decreases beyond FY 2013, and cannot project the negative effect of taxpayers having more Business Enterprise Tax (BET) to offset BPT as there will be less BPT against which they would apply their BET credit.