The proposed bill seeks to amend the Income Tax Act of 1967 by adding a new section, 684, which introduces an annual surcharge for taxpayers required to disclose their pay ratios under federal regulations. This surcharge will be applicable for tax years starting on or after October 1, 2025, and will be calculated as a percentage of the taxpayer's tax liability based on their disclosed pay ratio. The percentages range from 0% for a pay ratio of 50 to 1 or less, to 50% for a pay ratio of 500 to 1 or higher, with various increments in between.

Additionally, the bill specifies that the surcharge will not apply to taxpayers who are not required to file a return or pay taxes under the existing law. It also clarifies that if any member of a unitary business group is required to disclose a pay ratio, the entire group must comply. The bill includes provisions for the Department of Revenue to determine the correct pay ratio and surcharge if the SEC filing is incomplete or incorrect. The surcharge will be administered and enforced as part of the existing tax laws.

Statutes affected:
House Introduced Bill: 206.1, 206.847