Bill Text: IN SB0246 | 2010 | Regular Session | Introduced
Bill Title: Income tax rate adjustment.
Spectrum: Partisan Bill (Republican 1-0)
Status: (Introduced - Dead) 2010-01-11 - First reading: referred to Committee on Tax and Fiscal Policy [SB0246 Detail]
Download: Indiana-2010-SB0246-Introduced.html
Citations Affected: IC 6-3-2-1.
Synopsis: Income tax rate adjustment. Provides for a biennial
reduction in the state adjusted gross income tax rate on residents,
nonresidents, and corporations if year-over-year revenue from the
adjusted gross income tax exceeds certain amounts. Provides that the
minimum rate is 2.9% (3.4% for 2010) for persons and 8% (8.5% for
2010) for corporations. Requires the budget agency to make the
determination before July 1 of each even-numbered year and for the
rate reduction to take effect in taxable years beginning in the
immediately following odd-numbered year.
Effective: July 1, 2010.
January 11, 2010, read first time and referred to Committee on Tax and Fiscal Policy.
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A BILL FOR AN ACT to amend the Indiana Code concerning
taxation.
(b) Except as provided in section 1.5 of this chapter, each taxable year, a tax at the
(c) The tax rate to be used under subsection (a) or (b) is the same rate used for the preceding taxable year unless net adjusted gross income tax revenue collected by the state has increased, as determined under subsection (d). If the increase in revenue is at least three and one-tenth percent (3.1%), the tax rate to be used for
the taxable year beginning in the immediately following
odd-numbered year is the rate after the reduction under this
subsection. If the two (2) year average percentage increase in
revenue is:
(1) at least three and one-tenth percent (3.1%) but less than
four and two-tenths percent (4.2%), the tax rate is the
preceding taxable year's rate minus one-tenth percent (0.1%);
(2) at least four and two-tenths percent (4.2%) but less than
five and three-tenths percent (5.3%), the tax rate is the
preceding taxable year's rate minus two-tenths percent
(0.2%); or
(3) at least five and three-tenths percent (5.3%), the tax rate
is the preceding taxable year's rate minus three-tenths
percent (0.3%).
However, the rate used under subsection (a) for taxable years
beginning before January 1, 2011, is three and four-tenths percent
(3.4%), and the rate to be used for taxable years beginning after
December 31, 2010, may not be less than two and nine-tenths
percent (2.9%). However, the rate to be used under subsection (b)
for taxable years beginning before January 1, 2011, is eight and
five-tenths percent (8.5%), and the rate to be used for taxable
years beginning after December 31, 2010, may not be less than
eight percent (8%).
(d) Before September 1 of each even-numbered year, the budget
agency shall determine whether an increase in net adjusted gross
income tax revenue has occurred using a two (2) year average. In
making this determination, the following shall be used:
(1) Returns processed during the three (3) calendar years that
immediately precede the determination year.
(2) Net adjusted gross income tax revenue collected from all
taxpayers under this article on these returns.
(3) Overpayments refunded to taxpayers during these
calendar years shall be subtracted.
(4) The best information available to the budget agency at the
time the determination is made.
Beginning in 2010, the budget agency shall compute the two (2)
year average and determine whether an increase has occurred and,
if so, the amount of the two (2) year average percentage increase
in revenue. The budget agency shall certify the results of the
computation to the department of state revenue.