AB606: Bill Text

LRB-3311/1

JK:lmk:rs

2005 - 2006 LEGISLATURE

2005 Assembly BILL 606

August 16, 2005 - Introduced by Representatives Wieckert, Davis, Musser, Hahn, Townsend, Petrowski, Towns, Nass, Mursau, Ott, Albers, Hines, Van Roy and Gronemus, cosponsored by Senators Leibham and Roessler. Referred to Committee on Agriculture.

AB606,1,6 An Act to amend 71.05 (6) (a) 15., 71.21 (4), 71.26 (2) (a), 71.34 (1) (g), 71.45 (2) (a) 10. and 77.92 (4); and to create 71.07 (5e), 71.10 (4) (cq), 71.28 (5e), 71.30 (3) (dq), 71.47 (5e) and 71.49 (1) (dq) of the statutes; relating to: an income and franchise tax credit for sales and use taxes paid on the purchase of electricity used in agricultural biotechnology and on the purchase of products used on livestock.

Analysis by the Legislative Reference Bureau

This bill creates an income and franchise tax credit for the amount of the sales and use tax that a taxpayer pays in the taxable year on the purchase of electricity used in agricultural biotechnology and on the purchase of products used on livestock. If the amount of the credit exceeds the taxpayer's tax liability, the taxpayer does not receive a refund, but, instead, may claim the amount of any unused credit in subsequent taxable years.

For further information see the state fiscal estimate, which will be printed as an appendix to this bill.

The people of the state of Wisconsin, represented in senate and assembly, do enact as follows:

AB606, s. 1 Section 1. 71.05 (6) (a) 15. of the statutes is amended to read:

AB606,2,6 71.05 (6) (a) 15. The amount of the credits computed under s. 71.07 (2dd), (2de), (2di), (2dj), (2dL), (2dm), (2dr), (2ds), (2dx), (3g), (3n), (3s), (3t), (5b), and (5d), and (5e) and not passed through by a partnership, limited liability company, or tax-option corporation that has added that amount to the partnership's, company's, or tax-option corporation's income under s. 71.21 (4) or 71.34 (1) (g).

AB606, s. 2 Section 2. 71.07 (5e) of the statutes is created to read:

AB606,2,9 71.07 (5e) Agricultural biotechnology and livestock products credit. (a) Definitions. In this subsection:

AB606,2,17 1. "Agricultural biotechnology" means the application of technologies, including recombinant deoxyribonucleic acid techniques, biochemistry, molecular and cellular biology, genetics, genetic engineering, biological cell fusion techniques, and new bioprocesses, that use living organisms or parts of organisms to produce or modify products, improve plants or animals used in agriculture, develop microorganisms for specific agricultural uses, identify targets for small molecule pharmaceutical development for agricultural use, or transform biological systems into useful agricultural processes and products.

AB606,2,18 2. "Claimant" means a person who files a claim under this subsection.

AB606,2,23 (b) Filing claims. Subject to the limitations provided in this subsection, a claimant may claim as a credit against the taxes imposed under ss. 71.02 and 71.08, up to the amount of those taxes, an amount that is equal to the amount of the taxes imposed under ss. 71.52 and 71.53 that the claimant paid in the taxable year on the purchase of any of the following:

AB606,2,25 1. Electricity consumed in product research or product development for agricultural biotechnology in this state.

AB606,3,2 2. Vitamins, feed supplements, or hormones, if such products are used on farm livestock.

AB606,3,10 (c) Limitations. Partnerships, limited liability companies, and tax-option corporations may not claim the credit under this subsection, but the eligibility for, and the amount of, the credit are based on their payment of amounts described under par. (b). A partnership, limited liability company, or tax-option corporation shall compute the amount of credit that each of its partners, members, or shareholders may claim and shall provide that information to each of them. Partners, members of limited liability companies, and shareholders of tax-option corporations may claim the credit in proportion to their ownership interests.

AB606,3,12 (d) Administration. Section 71.28 (4) (e) to (h), as it applies to the credit under s. 71.28 (4), applies to the credit under this subsection.

AB606, s. 3 Section 3. 71.10 (4) (cq) of the statutes is created to read:

AB606,3,15 71.10 (4) (cq) Agricultural biotechnology and livestock products credit under s. 71.07 (5e).

AB606, s. 4 Section 4. 71.21 (4) of the statutes is amended to read:

AB606,3,19 71.21 (4) Credits computed by a partnership under s. 71.07 (2dd), (2de), (2di), (2dj), (2dL), (2dm), (2ds), (2dx), (3g), (3n), (3s), (3t), and (5b), and (5e) and passed through to partners shall be added to the partnership's income.

AB606, s. 5 Section 5. 71.26 (2) (a) of the statutes is amended to read:

AB606,4,13 71.26 (2) (a) Corporations in general. The "net income" of a corporation means the gross income as computed under the Internal Revenue Code as modified under sub. (3) minus the amount of recapture under s. 71.28 (1di) plus the amount of credit computed under s. 71.28 (1), (3), (4), and (5) minus, as provided under s. 71.28 (3) (c) 7., the amount of the credit under s. 71.28 (3) that the taxpayer added to income under this paragraph at the time that the taxpayer first claimed the credit plus the amount of the credit computed under s. 71.28 (1dd), (1de), (1di), (1dj), (1dL), (1dm), (1ds), (1dx), (3g), (3n), (3t), and (5b), and (5e) and not passed through by a partnership, limited liability company, or tax-option corporation that has added that amount to the partnership's, limited liability company's, or tax-option corporation's income under s. 71.21 (4) or 71.34 (1) (g) plus the amount of losses from the sale or other disposition of assets the gain from which would be wholly exempt income, as defined in sub. (3) (L), if the assets were sold or otherwise disposed of at a gain and minus deductions, as computed under the Internal Revenue Code as modified under sub. (3), plus or minus, as appropriate, an amount equal to the difference between the federal basis and Wisconsin basis of any asset sold, exchanged, abandoned, or otherwise disposed of in a taxable transaction during the taxable year, except as provided in par. (b) and s. 71.45 (2) and (5).

AB606, s. 6 Section 6. 71.28 (5e) of the statutes is created to read:

AB606,4,16 71.28 (5e) Agricultural biotechnology and livestock products credit. (a) Definitions. In this subsection:

AB606,4,24 1. "Agricultural biotechnology" means the application of technologies, including recombinant deoxyribonucleic acid techniques, biochemistry, molecular and cellular biology, genetics, genetic engineering, biological cell fusion techniques, and new bioprocesses, that use living organisms or parts of organisms to produce or modify products, improve plants or animals used in agriculture, develop microorganisms for specific agricultural uses, identify targets for small molecule pharmaceutical development for agricultural use, or transform biological systems into useful agricultural processes and products.

AB606,4,25 2. "Claimant" means a person who files a claim under this subsection.

AB606,5,5 (b) Filing claims. Subject to the limitations provided in this subsection, a claimant may claim as a credit against the taxes imposed under s. 71.23, up to the amount of those taxes, an amount that is equal to the amount of the taxes imposed under ss. 71.52 and 71.53 that the claimant paid in the taxable year on the purchase of any of the following:

AB606,5,7 1. Electricity consumed in product research or product development for agricultural biotechnology in this state.

AB606,5,9 2. Vitamins, feed supplements, or hormones, if such products are used on farm livestock.

AB606,5,17 (c) Limitations. Partnerships, limited liability companies, and tax-option corporations may not claim the credit under this subsection, but the eligibility for, and the amount of, the credit are based on their payment of amounts described under par. (b). A partnership, limited liability company, or tax-option corporation shall compute the amount of credit that each of its partners, members, or shareholders may claim and shall provide that information to each of them. Partners, members of limited liability companies, and shareholders of tax-option corporations may claim the credit in proportion to their ownership interests.

AB606,5,19 (d) Administration. Subsection (4) (e) to (h), as it applies to the credit under sub. (4), applies to the credit under this subsection.

AB606, s. 7 Section 7. 71.30 (3) (dq) of the statutes is created to read:

AB606,5,22 71.30 (3) (dq) Agricultural biotechnology and livestock products credit under s. 71.28 (5e).

AB606, s. 8 Section 8. 71.34 (1) (g) of the statutes is amended to read:

AB606,6,3 71.34 (1) (g) An addition shall be made for credits computed by a tax-option corporation under s. 71.28 (1dd), (1de), (1di), (1dj), (1dL), (1dm), (1ds), (1dx), (3), (3g), (3n), (3t), and (5b), and (5e) and passed through to shareholders.

AB606, s. 9 Section 9. 71.45 (2) (a) 10. of the statutes is amended to read:

AB606,6,10 71.45 (2) (a) 10. By adding to federal taxable income the amount of credit computed under s. 71.47 (1dd) to (1dx), (3n), and (5b), and (5e) and not passed through by a partnership, limited liability company, or tax-option corporation that has added that amount to the partnership's, limited liability company's, or tax-option corporation's income under s. 71.21 (4) or 71.34 (1) (g) and the amount of credit computed under s. 71.47 (1), (3), (3t), (4), and (5).

AB606, s. 10 Section 10. 71.47 (5e) of the statutes is created to read:

AB606,6,13 71.47 (5e) Agricultural biotechnology and livestock products credit. (a) Definitions. In this subsection:

AB606,6,21 1. "Agricultural biotechnology" means the application of technologies, including recombinant deoxyribonucleic acid techniques, biochemistry, molecular and cellular biology, genetics, genetic engineering, biological cell fusion techniques, and new bioprocesses, that use living organisms or parts of organisms to produce or modify products, improve plants or animals used in agriculture, develop microorganisms for specific agricultural uses, identify targets for small molecule pharmaceutical development for agricultural use, or transform biological systems into useful agricultural processes and products.

AB606,6,22 2. "Claimant" means a person who files a claim under this subsection.

AB606,7,2 (b) Filing claims. Subject to the limitations provided in this subsection, a claimant may claim as a credit against the taxes imposed under s. 71.43, up to the amount of those taxes, an amount that is equal to the amount of the taxes imposed under ss. 71.52 and 71.53 that the claimant paid in the taxable year on the purchase of any of the following:

AB606,7,4 1. Electricity consumed in product research or product development for agricultural biotechnology in this state.

AB606,7,6 2. Vitamins, feed supplements, or hormones, if such products are used on farm livestock.

AB606,7,14 (c) Limitations. Partnerships, limited liability companies, and tax-option corporations may not claim the credit under this subsection, but the eligibility for, and the amount of, the credit are based on their payment of amounts described under par. (b). A partnership, limited liability company, or tax-option corporation shall compute the amount of credit that each of its partners, members, or shareholders may claim and shall provide that information to each of them. Partners, members of limited liability companies, and shareholders of tax-option corporations may claim the credit in proportion to their ownership interests.