Revision: March 8, 2016, midnight
\t \t\tHB 1192-FN - AS INTRODUCED
2016 SESSION
\t16-2034
\t04/09
HOUSE BILL\t1192-FN
AN ACT\trepealing the education tax credit.
SPONSORS:\tRep. Ford, Graf. 3; Rep. Rosenwald, Hills. 30; Rep. Porter, Hills. 1; Rep. Wallner, Merr. 10; Rep. Myler, Merr. 10; Rep. Berch, Ches. 1; Sen. Kelly, Dist 10; Sen. Soucy, Dist 18; Sen. Woodburn, Dist 1
COMMITTEE:\tWays and Means
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ANALYSIS
\tThis bill repeals the education tax credit program.
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Explanation:\tMatter added to current law appears in bold italics.
\t\tMatter removed from current law appears [in brackets and struckthrough.]
\t\tMatter which is either (a) all new or (b) repealed and reenacted appears in regular type.
\t16-2034
\t04/09
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Sixteen
AN ACT\trepealing the education tax credit.
Be it Enacted by the Senate and House of Representatives in General Court convened:
\t1 Tax Expenditure and Potential Liability Reports; Tax Expenditures Specified. Amend RSA 71-C:2 to read as follows:
\t71-C:2 Tax Expenditures Specified. Tax expenditures include, but may not be limited to, the community development finance authority investment tax credit as computed in RSA 162-L:10; the economic revitalization zone tax credit as computed in RSA 162-N:6; the research and development tax credit under RSA 77-A:5, XIII; the Coos county job creation tax credit under RSA 77-E:3-c; [the education tax credit as computed in RSA 77-G:4;] and the weighted apportionment factors under RSA 77-A:3, II(a).
\t2 Tax Expenditure and Potential Liability Reports. Amend RSA 71-C:4, I-II to read as follows:
\t\tI. On or before December 15 of every fiscal year the commissioner of the department of revenue administration shall certify in a report to the general court and the governor an analysis of each of the past fiscal year’s tax expenditures as identified in RSA 71-C:2, and other credits allowed under RSA 77, RSA 77-A, RSA 77-E, [RSA 77-G,] RSA 78, RSA 78-A, 78-B, RSA 82-A, RSA 83-E, RSA 84-A, RSA 84-C, and RSA 400-A.
\t\tII. The report shall be divided into the following parts:
\t\t\t(a) Tax expenditures as determined by the joint committee on tax expenditure review under RSA 71-C:3;
\t\t\t(b) Potential liabilities against the state’s revenues, specifically:
\t\t\t\t(1) Other credits allowed under RSA 77, RSA 77-A, RSA 77-E, [RSA 77-G,] RSA 78, RSA 78-A, RSA 78-B, RSA 82, RSA 82-A, RSA 83-E, RSA 84-A, RSA 84-C, and RSA 400-A against the business profits tax imposed by RSA 77-A; and
\t\t\t\t(2) Credit carryovers from overpaid taxes.
\t3 Repeal. The following are repealed:
\t\tI. RSA 77-A:5, XV, relative to the education tax credit against the business profits tax.
\t\tII. RSA 77-E:3-d, relative to the education tax credit against the business enterprise tax.
\t\tIII. RSA 77-G, relative to education tax credit.
\t4 Effective Date. This act shall take effect upon its passage.
\t\t\t\t\t\t\t\t\t\t\t16-2034
\t\t\t\t\t\t\t\t\t\t\t10/19/15
1192-FN - FISCAL NOTE
AN ACT\trepealing the education tax credit.
FISCAL IMPACT:
The Department of Revenue Administration states this bill, as introduced, will increase state general and education trust fund revenue by an indeterminable amount in FY 2017 and each year thereafter. There is no fiscal impact on county and local revenue or state, county or local expenditures.
METHODOLOGY:
The Department of Revenue Administration states this bill repeals the education tax credit program contained in RSA 77-G. The elimination of this program will eliminate the tax credit allowed against the business profits tax pursuant to RSA 77-A, XV and the business enterprise tax pursuant to RSA 77-E:3-d. The education tax credit statute does not have a carryover provision therefore it can only be used to offset a tax liability in the tax year in which the donation was made. Tax credits issued in 2013 and 2014, totaling $167,315, have been utilized to the extent they could be used to offset taxes, unless the return of a credit recipient is amended. Program year 2015 is closed for donations. Tax credits based upon the donations for program year 2015 is $184,619 and will be awarded by December 1, 2015. The maximum savings that the repeal would create in FY 2017 and beyond would be $5,100,000. The Department does note the average yearly credits for the program years 2013 through 2015 is $117,311 (($184,619+$167,315)/3). Based on this historical data, the Department states the increase in state revenue will be under $200,000 each fiscal year. Depending on whether the intent of the bill is to allow the program year 2015 credits to be used will have an impact on the fiscal impact of the bill.