Florida Senate - 2013 SB 1316
By Senator Garcia
38-00746-13 20131316__
1 A bill to be entitled
2 An act relating to apportionment of income by sales
3 factor; amending s. 220.153, F.S.; defining the term
4 “manufacturer”; providing that only manufacturers
5 doing business within and without this state are
6 eligible for special apportionment of adjusted federal
7 income solely by sales factor for purposes of the
8 state corporate income tax; deleting provisions
9 requiring certain qualified capital expenditures
10 within a specified time period in order to qualify for
11 such apportionment; deleting application requirements
12 with respect thereto; providing an effective date.
13
14 Be It Enacted by the Legislature of the State of Florida:
15
16 Section 1. Section 220.153, Florida Statutes, is amended to
17 read:
18 220.153 Apportionment by sales factor.—
19 (1) DEFINITION.—As used in this section, the term
20 “manufacturer” means any business establishment whose code
21 classification under the North American Industry Classification
22 System (NAICS) is within sector 31-33, Manufacturing “qualified
23 capital expenditures” means expenditures in this state for
24 purposes substantially related to a business’s production or
25 sale of goods or services. The expenditure must fund the
26 acquisition of additional real property (land, buildings,
27 including appurtenances, fixtures and fixed equipment,
28 structures, etc.), including additions, replacements, major
29 repairs, and renovations to real property which materially
30 extend its useful life or materially improve or change its
31 functional use and the furniture and equipment necessary to
32 furnish and operate a new or improved facility. The term does
33 not include an expenditure for a passive investment or for an
34 investment intended for the accumulation of reserves or the
35 realization of profit for distribution to any person holding an
36 ownership interest in the business. The term does not include
37 expenditures to acquire an existing business or expenditures in
38 excess of $125 million to acquire land or buildings.
39 (2) APPORTIONMENT OF TAXES; ELIGIBILITY.—A manufacturer
40 taxpayer, not including a financial organization as defined in
41 s. 220.15(6) or a bank, savings association, international
42 banking facility, or banking organization as defined in s.
43 220.62, doing business within and without this state, who
44 applies and demonstrates to the Department of Economic
45 Opportunity that, within a 2-year period beginning on or after
46 July 1, 2011, it has made qualified capital expenditures equal
47 to or exceeding $250 million may apportion its adjusted federal
48 income solely by the sales factor set forth in s. 220.15(5),
49 commencing in the taxable year that the Department of Economic
50 Opportunity approves the application, but not before a taxable
51 year that begins on or after January 1, 2013. Once approved, a
52 manufacturer taxpayer may elect to apportion its adjusted
53 federal income for any taxable year using the method provided
54 under this section or the method provided under s. 220.15.
55 (3) QUALIFICATION PROCESS.—
56 (a) To qualify as a manufacturer that taxpayer who is
57 eligible to apportion its adjusted federal income under this
58 section, a manufacturer:
59 1. The taxpayer must notify the Department of Economic
60 Opportunity of its intent to submit an application to apportion
61 its adjusted federal income in order to commence the 2-year
62 period for measuring qualified capital expenditures.
63 2. The taxpayer must submit an application to apportion its
64 adjusted federal income under this section to the Department of
65 Economic Opportunity within 2 years after notifying the
66 Department of Economic Opportunity of the taxpayer’s intent to
67 qualify. The application must be made under oath and provide
68 such information as the Department of Economic Opportunity
69 reasonably requires by rule for determining the applicant’s
70 eligibility to apportion adjusted federal income under this
71 section. The manufacturer taxpayer is responsible for
72 affirmatively demonstrating to the satisfaction of the
73 Department of Economic Opportunity that it meets the eligibility
74 requirements.
75 (b) The manufacturer taxpayer notice and application forms
76 shall be established by the Department of Economic Opportunity
77 by rule. The Department of Economic Opportunity shall
78 acknowledge receipt of the notice and approve or deny the
79 application in writing within 45 days after receipt.
80 (4) REVIEW AUTHORITY; RECAPTURE OF TAX.—
81 (a) In addition to its existing audit authority, the
82 department may perform any financial and technical review and
83 investigation, including examining the accounts, books, and
84 records of a manufacturer the taxpayer as necessary, to verify
85 that the manufacturer’s taxpayer’s tax return correctly computes
86 and apportions adjusted federal income and to ensure compliance
87 with this chapter.
88 (b) The Department of Economic Opportunity may, by order,
89 revoke its decision to grant eligibility for apportionment
90 pursuant to this section, and may also order the recalculation
91 of apportionment factors to those applicable under s. 220.15 if,
92 as the result of an audit, investigation, or examination, it
93 determines that information provided by the manufacturer
94 taxpayer in the application, or in a statement, representation,
95 record, report, plan, or other document provided to the
96 Department of Economic Opportunity to become eligible for
97 apportionment, was materially false at the time it was made and
98 that an individual acting on behalf of the manufacturer taxpayer
99 knew, or should have known, that the information submitted was
100 false. The manufacturer taxpayer shall pay such additional taxes
101 and interest as may be due pursuant to this chapter computed as
102 the difference between the tax that would have been due under
103 the apportionment formula provided in s. 220.15 for such years
104 and the tax actually paid. In addition, the department shall
105 assess a penalty equal to 100 percent of the additional tax due.
106 (c) The Department of Economic Opportunity shall
107 immediately notify the department of an order affecting a
108 manufacturer’s taxpayer’s eligibility to apportion tax pursuant
109 to this section. A manufacturer that taxpayer who is liable for
110 past tax must file an amended return with the department, or
111 such other report as the department prescribes by rule, and pay
112 any required tax, interest, and penalty within 60 days after the
113 manufacturer taxpayer receives notification from the Department
114 of Economic Opportunity that the previously approved credits
115 have been revoked. If the revocation is contested, the
116 manufacturer taxpayer shall file an amended return or other
117 report within 30 days after an order becomes final. A
118 manufacturer that taxpayer who fails to pay the past tax,
119 interest, and penalty by the due date is subject to the
120 penalties provided in s. 220.803.
121 (5) RULES.—The Department of Economic Opportunity and the
122 department may adopt rules to administer this section.
123 Section 2. This act shall take effect July 1, 2013.