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1997 SESSION

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SB 1106 Enterprise Zone Act.

Introduced by: Henry L. Marsh III | all patrons    ...    notes | add to my profiles

SUMMARY:

Enterprise Zone Act. Allows unallocated amounts of tax credits in the $5 million tax credit pool to be allocated to business firms normally limited to the $3 million tax credit pool who would otherwise not receive tax credits when the $3 million tax credit pool is oversubscribed, and vice versa. Except for this pour-over feature, business firms that are required to negotiate the amount of their business income tax credits and real property investment tax credits will take their tax credits from the $3 million pool, while other business firms will take their tax credits from the $5 million pool. The formula for allocating the income of a qualified business firm between business activities located both within and outside an enterprise zone is amended to eliminate the location where sales are made as a factor. A business firm will be able to count residents of any enterprise zone, rather than only the zone where the firm is doing business, in determining whether it qualifies for the business income tax credit. Certifications by DHCD regarding a business firm's eligibility for tax credits will not prevent the Tax Department or State Corporation Commission from challenging a taxpayer's claim for a tax credit. The measure also clarifies that the 30 percent tax credit for qualified zone improvements, not to exceed $125,000 in any five-year period, is a refundable tax credit. It also provides for tax credits for reinvestment activities of qualified businesses.


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