Bill Summary – FastDemocracy

General Assembly                       Governor's Bill No. 5010
       February Session, 2020               LCO No. 708
     Referred to Committee on          FINANCE, REVENUE AND
     BONDING
     Introduced by:
       REP. ARESIMOWICZ, 30th Dist.
       REP. RITTER M., 1st Dist.
       SEN. LOONEY, 11th Dist.
       SEN. DUFF, 25th Dist.
 AN ACT CONCERNING REVENUE ITEMS TO IMPLEMENT THE
 GOVERNOR'S BUDGET.
 Be it enacted by the Senate and House of Representatives in General
 Assembly convened:
      Section 1. Subparagraph (K) of subdivision (1) of section 12-408 of the
    2020 supplement to the general statutes is repealed and the following is
    substituted in lieu thereof (Effective July 1, 2020):
      (K) (i) For calendar quarters (I) ending on or after September 30, 2019,
   but prior to July 1, 2020, and (II) ending on or after September 30, 2021,
   the commissioner shall deposit into the regional planning incentive
   account, established pursuant to section 4-66k, six and seven-tenths per
   cent of the amounts received by the state from the tax imposed under
   subparagraph (B) of this subdivision and ten and seven-tenths per cent
   of the amounts received by the state from the tax imposed under
   subparagraph (G) of this subdivision;
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    (ii) For calendar quarters ending on or after September 30, 2018, the
 commissioner shall deposit into the Tourism Fund established under
 section 10-395b ten per cent of the amounts received by the state from
 the tax imposed under subparagraph (B) of this subdivision;
   Sec. 2. Subparagraph (J) of subdivision (1) of section 12-411 of the
 2020 supplement to the general statutes is repealed and the following is
 substituted in lieu thereof (Effective July 1, 2020):
    (J) (i) For calendar quarters (I) ending on or after September 30, 2019,
 but prior to July 1, 2020, and (II) ending on or after September 30, 2021,
 the commissioner shall deposit into the regional planning incentive
 account, established pursuant to section 4-66k, six and seven-tenths per
 cent of the amounts received by the state from the tax imposed under
 subparagraph (B) of this subdivision and ten and seven-tenths per cent
 of the amounts received by the state from the tax imposed under
 subparagraph (G) of this subdivision;
    (ii) For calendar quarters ending on or after September 30, 2018, the
 commissioner shall deposit into the Tourism Fund established under
 section 10-395b ten per cent of the amounts received by the state from
 the tax imposed under subparagraph (B) of this subdivision;
   Sec. 3. Subdivision (8) of subsection (b) of section 12-214 of the 2020
 supplement to the general statutes is repealed and the following is
 substituted in lieu thereof (Effective from passage):
    (8) (A) With respect to income years commencing on or after January
 1, 2018, [and prior to January 1, 2021,] any company subject to the tax
 imposed in accordance with subsection (a) of this section shall pay, for
 such income year, except when the tax so calculated is equal to two
 hundred fifty dollars, an additional tax in an amount equal to ten per
 cent of the tax calculated under said subsection (a) for such income year,
 without reduction of the tax so calculated by the amount of any credit
 against such tax. The additional amount of tax determined under this
 subsection for any income year shall constitute a part of the tax imposed
 by the provisions of said subsection (a) and shall become due and be
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 paid, collected and enforced as provided in this chapter.
    (B) Any company whose gross income for the income year was less
 than one hundred million dollars shall not be subject to the additional
 tax imposed under subparagraph (A) of this subdivision. This exception
 shall not apply to taxable members of a combined group that files a
 combined unitary tax return.
   Sec. 4. Subdivision (8) of subsection (b) of section 12-219 of the 2020
 supplement to the general statutes is repealed and the following is
 substituted in lieu thereof (Effective from passage):
    (8) (A) With respect to income years commencing on or after January
 1, 2018, [and prior to January 1, 2021,] the additional tax imposed on any
 company and calculated in accordance with subsection (a) of this section
 shall, for such income year, except when the tax so calculated is equal to
 two hundred fifty dollars, be increased by adding thereto an amount
 equal to ten per cent of the additional tax so calculated for such income
 year, without reduction of the tax so calculated by the amount of any
 credit against such tax. The increased amount of tax payable by any
 company under this section, as determined in accordance with this
 subsection, shall become due and be paid, collected and enforced as
 provided in this chapter.
    (B) Any company whose gross income for the income year was less
 than one hundred million dollars shall not be subject to the additional
 tax imposed under subparagraph (A) of this subdivision. This exception
 shall not apply to taxable members of a combined group that files a
 combined unitary tax return.
   Sec. 5. Subdivision (1) of subsection (a) of section 12-219 of the 2020
 supplement to the general statutes is repealed and the following is
 substituted in lieu thereof (Effective from passage):
   (a) (1) Each company subject to the provisions of this part shall pay
 for the privilege of carrying on or doing business within the state, the
 larger of the tax, if any, imposed by section 12-214, as amended by this
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 act, and the tax calculated under this subsection. The tax calculated
 under this section shall be a tax of (A) three and one-tenth mills per
 dollar for income years commencing prior to January 1, [2021] 2022, (B)
 two and six-tenths mills per dollar for the income year commencing on
 or after January 1, [2021] 2022, and prior to January 1, [2022] 2023, (C)
 two and one-tenth mills per dollar for the income year commencing on
 or after January 1, [2022] 2023, and prior to January 1, [2023] 2024, (D)
 one and six-tenths mills per dollar for the income year commencing on
 or after January 1, 2024, and prior to January 1, 2025, (E) one and one-
 tenth mills per dollar for the income year commencing on or after
 January 1, [2023] 2025, and prior to January 1, [2024] 2026, and [(E)] (F)
 zero mills per dollar for income years commencing on or after January
 1, [2024] 2026, of the amount derived (i) by adding (I) the average value
 of the issued and outstanding capital stock, including treasury stock at
 par or face value, fractional shares, scrip certificates convertible into
 shares of stock and amounts received on subscriptions to capital stock,
 computed on the balances at the beginning and end of the taxable year
 or period, the average value of surplus and undivided profit computed
 on the balances at the beginning and end of the taxable year or period,
 and (II) the average value of all surplus reserves computed on the
 balances at the beginning and end of the taxable year or period, (ii) by
 subtracting from the sum so calculated (I) the average value of any
 deficit carried on the balance sheet computed on the balances at the
 beginning and end of the taxable year or period, and (II) the average
 value of any holdings of stock of private corporations including treasury
 stock shown on the balance sheet computed on the balances at the
 beginning and end of the taxable year or period, and (iii) by
 apportioning the remainder so derived between this and other states
 under the provisions of section 12-219a, provided in no event shall the
 tax so calculated exceed one million dollars or be less than two hundred
 fifty dollars.
    Sec. 6. Subsection (d) of section 12-217n of the general statutes is
 repealed and the following is substituted in lieu thereof (Effective from
 passage and applicable to income years commencing on or after January 1,
 2020):
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    (d) (1) The credit provided for by this section shall be allowed for any
 income year commencing on or after January 1, 1993, provided any
 credits allowed for income years commencing on or after January 1,
 1993, and prior to January 1, 1995, may not be taken until income years
 commencing on or after January 1, 1995, and, for the purposes of
 subdivision (2) of this subsection, shall be treated as if the credit for each
 such income year first became allowable in the first income year
 commencing on or after January 1, 1995.
    (2) No more than one-third of the amount of the credit allowable for
 any income year may be included in the calculation of the amount of the
 credit that may be taken in that income year.
    (3) The total amount of the credit under subdivision (1) of this
 subsection that may be taken for any income year may not exceed the
 greater of (A) fifty per cent of the taxpayer's tax liability or in the case of
 a combined return, fifty per cent of the combined tax liability, for such
 income year, determined without regard to any credits allowed under
 this section, and (B) the lesser of (i) two hundred per cent of the credit
 otherwise allowed under subsection (c) of this section for such income
 year, and (ii) ninety per cent of the taxpayer's tax liability or in the case
 of a combined return, ninety per cent of the combined liability for such
 income year, determined without regard to any credits allowed under
 this section.
    (4) (A) Credits that are allowed under this section [but] for income
 years commencing prior to January 1, 2020, that exceed the amount
 permitted to be taken in an income year [by reason] pursuant to the
 provisions of subdivision (1), (2) or (3) of this subsection [,] shall be
 carried forward to each of the successive income years until such credits,
 or applicable portion thereof, are fully taken.
   (B) Credits that are allowed under this section for income years
 commencing on or after January 1, 2020, that exceed the amount
 permitted to be taken in an income year pursuant to the provisions of
 subdivision (1), (2) or (3) of this subsection shall be carried forward to
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 each of the successive income years until such credits, or applicable
 portion thereof, are fully taken. In no case shall a credit, or any portion
 thereof, allowed under this section for income years commencing on or
 after January 1, 2020, be carried forward for a period of more than fifteen
 years.
    (C) No credit [permitted] allowed under this section shall be taken in
 any income year until the full amount of all allowable credits carried
 forward to such year from any prior income year, commencing with the
 earliest such prior year, that otherwise may be taken under subdivision
 (2) of this subsection in that income year, have been fully taken.
    Sec. 7. (NEW) (Effective from passage and applicable to quarterly periods
 commencing on or after July 1, 2020) Notwithstanding any provision of the
 general statutes allowing for a higher amount, for any quarterly periods
 commencing on or after July 1, 2020, the amount of tax credit or credits
 allowable against the tax imposed under chapter 212 of the general
 statutes, shall not exceed fifty and one one-hundredths per cent of the
 amount of tax due from a taxpayer under such chapter with respect to
 any such quarterly period of the taxpayer prior to the application of
 such credit or credits.
    Sec. 8. Subsection (a) of section 12-264 of the general statutes is
 repealed and the following is substituted in lieu thereof (Effective July 1,
 2020):
    (a) Each (1) municipality, or department or agency thereof, or district
 manufacturing, selling or distributing gas to be used for light, heat or
 power, (2) company the principal business of which is manufacturing,
 selling or distributing gas or steam to be used for light, heat or power,
 including each foreign electric company, as defined in section 16-246f,
 that holds property in this state, and (3) company required to register
 pursuant to section 16-258a, shall pay a quarterly tax upon gross
 earnings from such operations in this state. Gross earnings from such
 operations under subdivisions (1) and (2) of this subsection shall
 include, as determined by the Commissioner of Revenue Services, (A)
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 all income included in operating revenue accounts in the uniform
 systems of accounts prescribed by the Public Utilities Regulatory
 Authority for operations within the taxable quarter and, with respect to
 each such company, (B) all income identified in said uniform systems of
 accounts as income from merchandising, jobbing and contract work, (C)
 all revenues identified in said uniform systems of accounts as income
 from nonutility operations, (D) all revenues identified in said uniform
 systems of accounts as nonoperating retail income, and (E) receipts from
 the sale of residuals and other by-products obtained in connection with
 the production of gas, electricity or steam. Gross earnings from such
 operations under subdivision (3) of this subsection shall be gross income
 from the sales of natural gas. [, provided gross income shall not include
 income from the sale of natural gas to an existing combined cycle facility
 comprised of three gas turbines providing electric generation services,
 as defined in section 16-1, with a total capacity of seven hundred
 seventy-five megawatts, for use in the production of electricity.] Gross
 earnings of a gas company, as defined in section 16-1, shall not include
 income earned in a taxable quarter commencing prior to June 30, 2008,
 from the sale of natural gas or propane as a fuel for a motor vehicle. No
 deductions shall be allowed from such gross earnings for any
 commission, rebate or other payment, except a refund resulting from an
 error or overcharge and those specifically mentioned in section 12-265.
 Gross earnings of a company, as described in subdivision (2) of this
 subsection, shall not include income earned in any taxable quarter
 commencing on or after July 1, 2000, from the sale of steam.
    Sec. 9. Subsection (b) of section 12-330ee of the 2020 supplement to
 the general statutes is repealed and the following is substituted in lieu
 thereof (Effective October 1, 2020):
   (b) (1) [For each calendar month commencing on or after October 1,
 2019, a] A tax is imposed on all sales of electronic cigarette products
 made in this state by electronic cigarette wholesalers and payable by
 such wholesalers, at the following rates:
   (A) For each calendar month commencing on or after October 1, 2019,
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 but prior to October 1, 2020:
    [(A)] (i) For an electronic cigarette product that is prefilled, sealed by
 the manufacturer and not intended to be refillable, forty cents per
 milliliter of the electronic cigarette liquid contained therein; and
    [(B)] (ii) For any other electronic cigarette product, ten per cent of the
 wholesale sales price of such product, whether or not sold at wholesale,
 or if not sold, then at the same rate upon the use by the wholesaler; and
     (B) For each calendar month commencing on or after October 1, 2020,
 fifty per cent of the wholesale sales price of such product, whether or
 not sold at wholesale, or if not sold, then at the same rate upon the use
 by the wholesaler.
    (2) Only the first sale or use of the same product by an electronic
 cigarette wholesaler shall be used in computing the amount of tax due
 under this subsection.
    Sec. 10. Section 12-263p of the general statutes is repealed and the
 following is substituted in lieu thereof (Effective July 1, 2020, and
 applicable to calendar quarters commencing on or after July 1, 2020):
    As used in sections 12-263p to 12-263x, inclusive, and section 11 of
 this act, unless the context otherwise requires:
   (1) "Commissioner" means the Commissioner of Revenue Services;
   (2) "Department" means the Department of Revenue Services;
    (3) "Taxpayer" means any health care provider subject to any tax or
 fee under section 12-263q, [or] 12-263r or section 11 of this act;
   (4) "Health care provider" means an individual or entity that receives
 any payment or payments for health care items or services provided;
    (5) "Gross rece