House Bill hb0039E
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Florida House of Representatives - 2002 HB 39-E
By Representative Andrews
1 A bill to be entitled
2 An act relating to incentives to promote new
3 product development; providing a short title;
4 creating s. 288.1172, F.S.; providing
5 definitions; providing for licensing of certain
6 products or technologies by donor companies to
7 receiving companies for production and
8 marketing; providing duties of such companies
9 and the Department of Revenue; providing
10 requirements for product development
11 agreements; providing that donor companies may
12 be granted a credit which may be used as a
13 corporate income tax credit; requiring the
14 office to certify certain amounts to the
15 department; requiring the department to make
16 certain distributions; authorizing donor
17 companies to elect to change the type of credit
18 under certain circumstances; providing
19 requirements for such election; creating s.
20 220.115, F.S.; requiring receiving companies to
21 file a corporate tax return and remit to the
22 state certain fees in addition to any corporate
23 income tax due; relieving receiving companies
24 of payments to donor companies under certain
25 circumstances; providing remedies against a
26 donor company when a receiving company fails to
27 remit funds; providing for application of
28 administrative and penalty provisions of ch.
29 220, F.S.; creating s. 220.1825, F.S.;
30 providing for a credit against the corporate
31 income tax for donor companies that so elect;
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Florida House of Representatives - 2002 HB 39-E
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1 providing for carryover of the credit;
2 providing for rules; amending s. 220.02, F.S.;
3 providing order of credits against the
4 corporate income tax; providing an effective
5 date.
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7 Be It Enacted by the Legislature of the State of Florida:
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9 Section 1. This act may be cited as the "New Product
10 Transfer Enhancement Act."
11 Section 2. Section 288.1172, Florida Statutes, is
12 created to read:
13 288.1172 Licensing of products or technologies by
14 donor companies to receiving companies; credits and use
15 thereof.--
16 (1) The purpose of this section is to promote economic
17 growth by providing an incentive for corporations which have
18 developed or patented products or technologies they do not
19 wish to develop further to license those items to companies
20 located in Florida for production and marketing.
21 (2) As used in this section:
22 (a) "Annual statement of donor credit" means the
23 statement produced by the Department of Revenue for each donor
24 company listing the total amount of credit available to the
25 donor company for all of the product development agreements it
26 has entered into. This statement shall also include any
27 additional information specified in the product development
28 agreement.
29 (b) "Annual statement of fees due" means the statement
30 submitted by the receiving company to the Department of
31 Revenue each year, which lists the amount of fees and
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1 royalties owed by it under the product development agreement
2 to the donor company for the preceding tax year which it has
3 paid to the department. This statement shall also contain any
4 additional information specified in the product development
5 agreement and shall contain a copy of the product development
6 agreement.
7 (c) "Donor company" means an entity subject to the tax
8 imposed by chapter 220 which has developed or holds the patent
9 for a product or technology that it does not wish to develop
10 itself and which has entered into a product development
11 agreement.
12 (d) "Product development agreement" means a contract
13 or series of contracts which provides the receiving company
14 with the right to produce and market a product or technology
15 which was developed or patented by the donor company.
16 (e) "Receiving company" means a business operating in
17 this state which has entered into a product development
18 agreement for the purpose of obtaining the right to produce
19 and market a product or technology from a donor company.
20 (3) To qualify under this section, a product
21 development agreement shall specify that a minimum of 75
22 percent of the jobs created by the production of the new
23 product or technology shall be located in this state. In
24 addition, the agreement shall specify the amount of
25 compensation to be remitted by the receiving company for the
26 license, and the type of credit the donor company has elected
27 to receive. The agreement shall further provide for submission
28 by the receiving company of an annual statement of fees due to
29 the Department of Revenue and shall specify the information to
30 be included in the statement.
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1 (4) Each receiving company shall submit an annual
2 statement of fees due to the Department of Revenue within 30
3 days after filing its corporate income tax return for this
4 state for the preceding tax year, in a format developed by the
5 department. The department shall be responsible for producing
6 an annual statement of donor credit for each donor company
7 using the information contained in the statements. The donor
8 credit for each donor company shall equal 94.5 percent of the
9 total of the amounts specified in the annual statements of
10 fees due from all receiving companies with which it has
11 entered into a product development agreement. In any year the
12 total amount of credits granted under all annual statements of
13 donor credit shall not exceed 94.5 percent of the amount due
14 to the state under all annual statements of fees due.
15 (5) The Department of Revenue shall send the annual
16 statement of donor credit to each donor company within 90 days
17 after the receipt of the annual statement of fees due. These
18 statements shall contain the information specified by the
19 product development agreement. The department shall specify,
20 in a format developed by the department, the amount of credit
21 due to each donor company based upon the funds paid to the
22 department by the receiving company for the preceding tax
23 year, the identities of the receiving companies from which
24 those credits originated, and the type of credit the donor
25 company has elected to receive.
26 (6) The donor company may elect to apply the amount
27 specified in the annual statement of donor credit as a
28 corporate income tax credit under s. 220.1825. In no case
29 shall the combined benefits exceed the amount specified in the
30 annual statement of donor credit.
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1 Section 3. Section 220.115, Florida Statutes, is
2 created to read:
3 220.115 Fees due from receiving companies pursuant to
4 s. 288.1172.--In addition to the tax imposed by this chapter,
5 any company which has entered into a product development
6 agreement pursuant to s. 288.1172 as a receiving company shall
7 remit to the state the funds listed as paid to the state on
8 the annual statement of fees due which the company has
9 submitted to the Department of Revenue. Even if no tax is due
10 under this chapter and a return would not normally be
11 required, a Florida corporate income tax return shall be filed
12 by the receiving company, and the funds to be listed on the
13 annual statement of fees due shall be remitted to the
14 department, subject to all filing requirements, fines, and
15 penalties specified for returns and taxes due under this
16 chapter. The department may adopt rules requiring the
17 information it considers necessary to ensure that the funds
18 due under this section are properly reported and paid,
19 including, but not limited to, rules relating to the methods,
20 forms which shall include returns to be filed by the receiving
21 companies, deadlines, and penalties for providing the
22 information required under this section.
23 Section 4. Section 220.1825, Florida Statutes, is
24 created to read:
25 220.1825 Credit for donor companies pursuant to s.
26 288.1172.--A credit against the tax imposed by this chapter
27 shall be allowed to a donor company which has entered into a
28 product development agreement pursuant to s. 288.1172, and
29 which has elected to apply its donor credit as a corporate
30 income tax credit. Such credit shall be limited to 94.5
31 percent of the amount stated in the annual statement of fees
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1 due submitted to the Department of Revenue by the receiving
2 companies. If any credit granted under this section is not
3 fully used in the first year for which it becomes available,
4 the unused amount may be carried forward for a period not to
5 exceed 5 years. The Department of Revenue may adopt rules
6 relating to the method of reporting and claiming this credit.
7 Section 5. Subsection (8) of section 220.02, Florida
8 Statutes, is amended to read:
9 220.02 Legislative intent.--
10 (8) It is the intent of the Legislature that credits
11 against either the corporate income tax or the franchise tax
12 be applied in the following order: those enumerated in s.
13 631.828, those enumerated in s. 220.191, those enumerated in
14 s. 220.181, those enumerated in s. 220.183, those enumerated
15 in s. 220.182, those enumerated in s. 220.1895, those
16 enumerated in s. 221.02, those enumerated in s. 220.184, those
17 enumerated in s. 220.186, those enumerated in s. 220.1845,
18 those enumerated in s. 220.19, those enumerated in s. 220.185,
19 and those enumerated in s. 220.187, and those enumerated in s.
20 220.1825.
21 Section 6. This act shall take effect upon becoming a
22 law.
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Florida House of Representatives - 2002 HB 39-E
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2 HOUSE SUMMARY
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Creates the New Product Transfer Enhancement Act.
4 Provides for licensing of products or technologies by
donor companies to receiving companies for production and
5 marketing. Provides duties of such companies and the
Department of Revenue. Provides that donor companies may
6 be granted a credit which may be used as a corporate
income tax credit. Provides requirements for product
7 development agreements. Requires receiving companies to
file a corporate tax return and remit fees to the state
8 in addition to any corporate income tax due. Provides for
application of administrative and penalty provisions of
9 chapter 220, Florida Statutes.
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