SENATE BILL 560
50th legislature - STATE OF NEW MEXICO - first session, 2011
INTRODUCED BY
William H. Payne
AN ACT
RELATING TO TAXATION; CREATING THE HEADQUARTERS CORPORATE INCOME TAX CREDIT; PROVIDING A CORPORATE INCOME TAX CREDIT FOR LOCATING OR EXPANDING A CORPORATE HEADQUARTERS AND CREATING AT LEAST ONE HUNDRED NEW FULL-TIME JOBS IN NEW MEXICO.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
SECTION 1. A new section of the Corporate Income and
Franchise Tax Act is enacted to read:
"[NEW MATERIAL] HEADQUARTERS CORPORATE INCOME TAX CREDIT.--
A. A taxpayer that is a New Mexico corporation that, after July 1, 2011, makes a capital investment of ten million dollars ($10,000,000) or more in new construction or renovations for a regional, national or international corporate headquarters located in New Mexico, that creates at least one hundred new full-time jobs and that files a corporate income tax return may claim a credit in an amount equal to five thousand dollars ($5,000) for the gross wages paid to each new employee who is employed full time on or after July 1, 2011 in New Mexico to fill a new employment position and who was employed by the taxpayer for at least twelve months. The tax credit provided by this section may be referred to as the "headquarters corporate income tax credit".
B. The purpose of the headquarters corporate income tax credit is to encourage corporations to locate or expand a regional, national or international headquarters, to create new jobs that are full-time and are permanent jobs and to reduce the unemployment rate of New Mexico.
C. A taxpayer may claim the headquarters corporate income tax credit provided in this section for the taxable year in which one or more employees of the taxpayer completes twelve months of employment in New Mexico from the date of hire and subsequent taxable years; provided that the taxpayer shall not claim the headquarters corporate income tax credit for any employee for more than three taxable years from the date of hire.
D. That portion of the headquarters corporate income tax credit approved by the department that exceeds a taxpayer's corporate income tax liability in the taxable year in which the headquarters corporate income tax credit is claimed shall not be refunded to the taxpayer. The headquarters corporate income tax credit shall not be carried forward or transferred to another taxpayer.
E. A taxpayer that claims and is granted approval for the headquarters corporate income tax credit shall not apply for or be granted approval for the rural job tax credit pursuant to Section 7-2E-1.1 NMSA 1978, the high-wage jobs tax credit pursuant to Section 7-9G-1 NMSA 1978 or the additional credit pursuant to the Technology Jobs Tax Credit Act.
F. The taxpayer shall submit to the economic development department a corporate headquarters development plan that details the capital investment of and the job creation related to locating or expanding the taxpayer's regional, national or international headquarters and, with respect to each employee for whom the headquarters corporate income tax credit is claimed, information required by the secretary of economic development:
(1) with respect to the employee's employment by the taxpayer during the taxable year for which the headquarters corporate income tax credit is claimed and the prior taxable year;
(2) to establish that the employee was not transferred or relocated from an existing job; and
(3) to establish that a new job was created for the employee of the taxpayer claiming the headquarters corporate income tax credit.
G. The economic development department shall adopt rules establishing procedures to certify the taxpayer and employees for purposes of obtaining a headquarters corporate income tax credit. The rules shall ensure that not more than one headquarters corporate income tax credit per employee shall be allowed in a taxable year and that the credits allowed per employee are limited to a maximum of three years. The economic development department shall issue a dated certificate of eligibility containing a list of the employees of the taxpayer employed in positions for which the headquarters corporate income tax credit is claimed, including identifying information such as the social security number of the employee, the date of discharge from previous employment, the date of hire of the employee by the taxpayer and the number of hours worked per week by the employee. All certificates of eligibility issued pursuant to this subsection shall be sequentially numbered, and an account of all certificates issued or destroyed shall be maintained by the economic development department. The taxation and revenue department shall audit the records of the headquarters corporate income tax credit maintained by the economic development department on a periodic basis to ensure effective administration of the headquarters corporate income tax credit and compliance with the Tax Administration Act and this section.
H. To claim a headquarters corporate income tax credit, the taxpayer shall provide to the taxation and revenue department the certificate of eligibility issued by the economic development department pursuant to this section to the taxpayer for the taxable year for which the headquarters corporate income tax credit is claimed.
I. The taxation and revenue department may allow a maximum annual aggregate of five million dollars ($5,000,000) in headquarters corporate income tax credits that may be claimed pursuant to the Corporate Income and Franchise Tax Act. Applications for the headquarters corporate income tax credit shall be considered in the order received by the department.
J. The taxation and revenue department shall compile an annual report that includes the number of taxpayers approved by the department to receive a headquarters corporate income tax credit. The economic development department shall track state expenditures and job creation and quantify the state's return on investment and report by November of each year to the legislative interim revenue stabilization and tax policy committee and the legislative finance committee on the effectiveness of the headquarters corporate income tax credit. Notwithstanding any other section of law to the contrary, the taxation and revenue department and the economic development department may disclose the number of applicants for the headquarters corporate income tax credit, the amount of each credit approved, the number of employees hired, the length of time the employee is employed while the taxpayer receives the headquarters corporate income tax credit and any other information required by the legislature or the economic development department to aid in evaluating the effectiveness of the headquarters corporate income tax credit.
K. An appropriate legislative committee shall review the effectiveness of the headquarters corporate income tax credit every four years beginning in 2015."
SECTION 2. APPLICABILITY.--The provisions of this act shall apply to taxable years beginning on or after January 1, 2011.
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