Revision: Jan. 16, 2019, 8:50 a.m.
HB 623-FN-A - AS INTRODUCED
2019 SESSION
19-0689
10/08
HOUSE BILL 623-FN-A
AN ACT relative to the rates of the business profits tax and business enterprise tax.
SPONSORS: Rep. Almy, Graf. 13; Rep. Mombourquette, Hills. 5; Rep. Schultz, Merr. 18; Rep. Fellows, Graf. 8; Rep. Horrigan, Straf. 6; Rep. T. Smith, Hills. 17; Rep. Edgar, Rock. 21; Rep. Porter, Hills. 1; Rep. Herbert, Hills. 43; Rep. Cloutier, Sull. 10
COMMITTEE: Ways and Means
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ANALYSIS
This bill establishes the rates of the business profits tax and the business enterprise tax for taxpayer tax years ending on or after December 31, 2019 and for subsequent tax years, and repeals rate reductions effective in 2021.
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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Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
19-0689
10/08
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Nineteen
AN ACT relative to the rates of the business profits tax and business enterprise tax.
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 Business Profits Tax; Imposition of Tax; 2019. RSA 77-A:2 is repealed and reenacted to read as follows:
77-A:2 Imposition of Tax. A tax is imposed at the rate of 8.5 percent upon the taxable business profits of every business organization.
2 Business Enterprise Tax; Imposition of Tax; 2019. RSA 77-E:2 is repealed and reenacted to read as follows:
77-E:2 Imposition of Tax. A tax is imposed at the rate of .50 percent upon the taxable enterprise value tax base of every business enterprise.
3 Repeal of Prospective Amendments. The following are repealed:
I. 2017, 156:215; relative to the rate of the business profits tax in 2021.
II. 2017, 156:216; relative to the rate of the business enterprise tax in 2021.
III. 2017, 156:217, II, relative to the applicability of the 2021 rates changes.
4 Applicability. Sections 1 and 2 of this act shall apply to taxable periods ending on or after December 31, 2019.
5 Effective Date. This act shall take effect 60 days after its passage.
19-0689
1/7/19
HB 623-FN-A- FISCAL NOTE
AS INTRODUCED
AN ACT relative to the rates of the business profits tax and business enterprise tax.
FISCAL IMPACT: [ X ] State [ ] County [ ] Local [ ] None
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| Estimated Increase / (Decrease) | |||
STATE: | FY 2020 | FY 2021 | FY 2022 | FY 2023 |
Appropriation | $0 | $0 | $0 | $0 |
Revenue | Indeterminable Increase | Indeterminable Increase | Indeterminable Increase | Indeterminable Increase |
Expenditures | $0 | $0 | $0 | $0 |
Funding Source: | [ X ] General [ X ] Education [ ] Highway [ ] Other | |||
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METHODOLOGY:
This bill increases the business profits tax rate for taxable periods ending on or after December 31, 2019 from 7.7 percent to 8.5 percent and reduces the business enterprise tax rate for taxable periods ending on or after December 31, 2019 from 0.6 percent to 0.5 percent. The bill also repeals prospective decreases in the business profits and business enterprise taxes in 2021. The exact fiscal impact of this bill cannot be determined, however the Department is able to provide an estimate based on the following assumptions:
It should be noted the fiscal impact of the proposed rate reductions may vary for future fiscal years depending on whether actual revenue is more or less than the FY 2018 revenue amount The table below summarizes the Department's analysis:
Fiscal Impact of Rate Reductions by Fiscal Year
Fiscal Year | FY 18 Revenue with Current BPT and BET Rate Reductions Applied | FY 18 Revenue with New BPT Rate Increase and BET Rate Reduction | Difference |
FY20 | $710,527,743 | $717,369,371 | $6,841,629 |
FY21 | $692,565,789 | $710,135,004 | $17,569,215 |
FY22 | $658,212,733 | $710,135,004 | $51,922,270 |
FY23 | $651,234,769 | $710,135,004 | $58,900,235 |
AGENCIES CONTACTED:
Department of Revenue Administration