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H0537...............................................by REVENUE AND TAXATION
INCOME TAX - CREDIT - Adds to existing law to provide a state income tax
credit for each new employee employed in mining, if the taxpayer has not
claimed another new jobs natural resources tax credit; and to provide a
state income tax credit for each employee employed in mining in Idaho.
02/01 House intro - 1st rdg - to printing
02/04 Rpt prt - to Rev/Tax
02/15 Rpt out - rec d/p - to 2nd rdg
02/18 2nd rdg - to 3rd rdg
02/21 Ret'd to Rev/Tax
|||| LEGISLATURE OF THE STATE OF IDAHO ||||
Fifty-sixth Legislature Second Regular Session - 2002
IN THE HOUSE OF REPRESENTATIVES
HOUSE BILL NO. 537
BY REVENUE AND TAXATION COMMITTEE
1 AN ACT
2 RELATING TO INCOME TAXATION; AMENDING CHAPTER 30, TITLE 63, IDAHO CODE, BY THE
3 ADDITION OF A NEW SECTION 63-3029M, IDAHO CODE, TO DEFINE TERMS, TO PRO-
4 VIDE FOR CONSTRUCTION OF TERMS, TO PROVIDE A STATE INCOME TAX CREDIT FOR
5 NEW EMPLOYEES EMPLOYED IN MINING IF THE TAXPAYER HAS NOT CLAIMED ANOTHER
6 NEW JOBS NATURAL RESOURCES TAX CREDIT AND TO PROVIDE IF TAXES DUE ARE LESS
7 THAN THE TOTAL CREDIT ALLOWED, THE TAXPAYER SHALL BE PAID A REFUND EQUAL
8 TO THE BALANCE OF THE UNUSED CREDIT; AMENDING CHAPTER 30, TITLE 63, IDAHO
9 CODE, BY THE ADDITION OF A NEW SECTION 63-3029N, IDAHO CODE, TO DEFINE
10 TERMS, TO PROVIDE FOR CONSTRUCTION OF TERMS, TO PROVIDE A STATE INCOME TAX
11 CREDIT FOR TAXABLE YEAR 2002 ONLY FOR EMPLOYEES EMPLOYED IN MINING AND TO
12 PROVIDE IF TAXES DUE ARE LESS THAN THE TOTAL CREDIT ALLOWED, THE TAXPAYER
13 SHALL BE PAID A REFUND EQUAL TO THE BALANCE OF THE UNUSED CREDIT; DECLAR-
14 ING AN EMERGENCY AND PROVIDING RETROACTIVE APPLICATION.
15 Be It Enacted by the Legislature of the State of Idaho:
16 SECTION 1. That Chapter 30, Title 63, Idaho Code, be, and the same is
17 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
18 ignated as Section 63-3029M, Idaho Code, and to read as follows:
19 63-3029M. DEFINITIONS -- CONSTRUCTION OF TERMS -- NEW EMPLOYEES IN MIN-
20 ING. As used in this section:
21 (1) (a) "New employee" means a person from whom Idaho income tax has been
22 withheld, employed by the taxpayer in the production or processing of
23 "valuable minerals" as defined in section 47-1205, Idaho Code, and covered
24 for unemployment insurance purposes under chapter 13, title 72, Idaho
25 Code, during the taxable year for which the credit allowed by this section
26 is claimed. A person shall be deemed to be so engaged if such person per-
27 forms duties on:
28 (i) A regular full-time basis; or
29 (ii) A part-time basis if such person is customarily performing such
30 duties at least twenty (20) hours per week.
31 No credit shall be earned pursuant to this section unless the new employee
32 shall have performed such duties for the taxpayer for a minimum of nine
33 (9) months during the taxable year for which the credit is claimed.
34 (b) The provisions of paragraph (a) of this subsection notwithstanding,
35 no credit shall be allowed for employment of persons by a taxpayer who
36 acquires a production or processing of a valuable mineral enterprise
37 from another taxpayer or who operates in a place of business the same or a
38 substantially identical production or processing of a valuable mineral
39 enterprise as operated by another taxpayer within the prior twelve (12)
40 months, except as the prior taxpayer would have qualified under the provi-
41 sions of paragraph (c) of this subsection. Employees transferred from a
42 related taxpayer shall not be included in the computation of the credit.
43 (c) The number of employees during any taxable year for any taxpayer
2
1 shall be the mathematical average of the number of employees reported to
2 the Idaho department of labor for employment security purposes during the
3 twelve (12) months of the taxable year which qualified under paragraph (a)
4 of this subsection. In the event the business is in operation for less
5 than the entire taxable year, the number of employees of the business for
6 the year shall be the average number actually employed during the months
7 of operation, providing that the qualifications of paragraph (a) of this
8 subsection are met.
9 (2) "Same or a substantially valuable mineral enterprise" means a valu-
10 able mineral enterprise in which the products produced or sold, or the activi-
11 ties conducted are the same in character and use and are produced, sold or
12 conducted in the same manner as, or for the same types of customers as, the
13 products or activities produced, sold or conducted in another valuable mineral
14 enterprise.
15 (3) "Valuable mineral enterprise" means the activities performed in the
16 extraction and processing of valuable minerals as defined in section 47-1205,
17 Idaho Code, from the ground, including, but not limited to, the excavation of
18 pits, removal of minerals, crushing, milling, disposal of overburden, the con-
19 struction of haulage roads, beneficiation, transportation, stockpiling, smelt-
20 ing, calcining and chemical processing.
21 (4) If the taxpayer has not claimed the tax credit pursuant to section
22 63-3029E, Idaho Code, the taxpayer shall be allowed a credit, in an amount
23 determined under subsection (5) of this section, against the tax imposed by
24 this chapter, other than the tax imposed by section 63-3082, Idaho Code, for
25 any taxable year during which the taxpayer's employment of new employees, as
26 defined in subsection (1) of this section, increases above the taxpayer's
27 average employment for either: (a) the prior taxable year, or (b) the average
28 of three (3) prior taxable years, whichever is higher. No credit shall be
29 allowed under this section unless the number of new employees equals or
30 exceeds one (1) person.
31 (5) The credit authorized by this section shall be five hundred dollars
32 ($500) per new employee during any taxable year. If taxes due are less than
33 the total credit allowed, the taxpayer shall be paid a refund equal to the
34 balance of the unused credit.
35 SECTION 2. That Chapter 30, Title 63, Idaho Code, be, and the same is
36 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
37 ignated as Section 63-3029N, Idaho Code, and to read as follows:
38 63-3029N. DEFINITIONS -- CONSTRUCTION OF TERMS -- EMPLOYEES IN MINING. As
39 used in this section:
40 (1) (a) "Employee" means a person from whom Idaho income tax has been
41 withheld, employed by the taxpayer in the production or processing of
42 "valuable minerals" as defined in section 47-1205, Idaho Code, and covered
43 for unemployment insurance purposes under chapter 13, title 72, Idaho
44 Code, during the taxable year for which the credit allowed by this section
45 is claimed. A person shall be deemed to be so engaged if such person per-
46 forms duties on:
47 (i) A regular full-time basis; or
48 (ii) A part-time basis if such person is customarily performing such
49 duties at least twenty (20) hours per week.
50 No credit shall be earned pursuant to this section unless the employee
51 shall have performed such duties for the taxpayer for a minimum of nine
52 (9) months during the taxable year for which the credit is claimed.
53 (b) The number of employees during any taxable year for any taxpayer
3
1 shall be the mathematical average of the number of employees reported to
2 the Idaho department of labor for employment security purposes during the
3 twelve (12) months of the taxable year which qualified under paragraph (a)
4 of this subsection. In the event the business is in operation for less
5 than the entire taxable year, the number of employees of the business for
6 the year shall be the average number actually employed during the months
7 of operation, providing that the qualifications of paragraph (a) of this
8 subsection are met.
9 (2) "Valuable mineral enterprise" means the activities performed in the
10 extraction and processing of valuable minerals as defined in section 47-1205,
11 Idaho Code, from the ground, including, but not limited to, the excavation of
12 pits, removal of minerals, crushing, milling, disposal of overburden, the con-
13 struction of haulage roads, beneficiation, transportation, stockpiling, smelt-
14 ing, calcining and chemical processing.
15 (3) For taxable year 2002 only, any taxpayer shall be allowed a credit,
16 in an amount determined under subsection (4) of this section, against the tax
17 imposed by this chapter, other than the tax imposed by section 63-3082, Idaho
18 Code, for any taxable year during which the taxpayer's employment of employees
19 occurs, as defined in subsection (1) of this section. No credit shall be
20 allowed under this section unless the number of employees equals or exceeds
21 one (1) person.
22 (4) The credit authorized by this section shall be five hundred dollars
23 ($500) per employee during any taxable year. If taxes due are less than the
24 total credit allowed, the taxpayer shall be paid a refund equal to the balance
25 of the unused credit.
26 SECTION 3. An emergency existing therefor, which emergency is hereby
27 declared to exist, this act shall be in full force and effect on and after its
28 passage and approval, and retroactively to January 1, 2002.
STATEMENT OF PURPOSE
RS 11737C3
The purpose of this bill is twofold. First is to provide a onetime
income tax credit of $500 per job for existing jobs in the mining
industry. Second is to provide a $500 per job income tax credit for
new jobs.
Contact
Name: Jack Lyman, Idaho Mining Association
Phone: 342-0031
FISCAL IMPACT
The impact to the General Fund will be a reduction of $1.3 million
based on an estimated 2,600 existing jobs. It is estimated that 100
new jobs will be created in 2003, resulting in a fiscal impact of
$50,000.
STATEMENT OF PURPOSE/FISCAL NOTE H 537