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HB 204 - Income tax credit; certain tobacco settlement proceeds

Wiles, John J (34th)	Irvin, Robert A (45th)	Ehrhart, Earl (36th)
Lewis, Walter Jeffrey (14th)	Scarlett, Stephen G (174th)	Stancil, Steve (16th)

Status Summary	HC:	W&M	SC:		FR:	01/26/99	LA:	01/27/99	H - Read 2nd Time

First Reader Summary

A BILL to amend Article 2 of Chapter 7 of Title 48 of the Official Code of Georgia Annotated, relating to imposition, rate, computation, and exemptions with respect to income taxes, so as to provide for an income tax credit regarding certain tobacco settlement proceeds; and for other purposes.

Code Sections - 48-7-29.3

HB 204                                             LC 18 9216 
 
 
 
 
 
 
                        A BILL TO BE ENTITLED 
                               AN ACT 
 
 
  1- 1  To amend Article 2 of Chapter 7 of Title 48 of the Official 
  1- 2  Code of Georgia Annotated, relating to imposition, rate, 
  1- 3  computation, and exemptions with respect to income taxes, so 
  1- 4  as to provide for an income tax credit regarding certain 
  1- 5  tobacco settlement proceeds; to provide for a definition; to 
  1- 6  provide for procedures, conditions, and limitations; to 
  1- 7  provide for powers, duties, and authority of the state 
  1- 8  revenue commissioner with respect to the foregoing; to 
  1- 9  provide for an effective date; to provide for applicability; 
  1-10  to repeal  conflicting laws; and for other purposes. 
 
  1-11       BE IT ENACTED BY THE GENERAL ASSEMBLY OF GEORGIA: 
 
  1-12                           SECTION 1. 
 
  1-13  Article 2 of Chapter 7 of Title 48 of the Official Code of 
  1-14  Georgia Annotated, relating to imposition, rate, 
  1-15  computation, and exceptions with respect to income taxes, is 
  1-16  amended by adding a new Code section immediately after Code 
  1-17  Section 48-7-29.2, to be designated Code Section 48-7-29.3, 
  1-18  to read as follows: 
 
  1-19    "48-7-29.3. 
 
  1-20    (a) As used in this Code section, the term 'tobacco 
  1-21    settlement proceeds' means the proceeds received by this 
  1-22    state from the settlement of the lawsuit filed by the 
  1-23    state against certain tobacco companies, State of Georgia, 
  1-24    et al. v. Philip Morris, Inc., et al., Civil Action 
  1-25    #E-61692, V19/246 (Fulton County Superior Court, December 
  1-26    9, 1998). 
 
  1-27    (b) A taxpayer shall be allowed a credit against the tax 
  1-28    imposed by Code Section 48-7-20 in an amount determined in 
  1-29    accordance with subsection (c) of this Code section. 
 
  1-30      (c)(1) Such tax credit shall be established each year by 
  1-31      the commissioner pursuant to the calculation required 
  1-32      under this subsection.  The commissioner shall determine 
  1-33      annually the adjusted proceeds as follows: 
 
 
 
                                 -1- 
 
 
 
  2- 1        (A) For the first year in which credits are allowed 
  2- 2        under this Code section, the amount of the tobacco 
  2- 3        settlement proceeds received by the state for that 
  2- 4        year shall be the adjusted proceeds for purposes of 
  2- 5        the calculation under paragraph (2) of this 
  2- 6        subsection; and 
 
  2- 7        (B) For each year following the first year in which 
  2- 8        credits are allowed under this Code section: 
 
  2- 9          (i) If the aggregate amount of such credits actually 
  2-10          claimed and allowed for the immediately preceding 
  2-11          year equals the adjusted proceeds for that 
  2-12          immediately preceding year, the amount of the 
  2-13          tobacco settlement proceeds for the following year 
  2-14          shall be those adjusted proceeds for that year; 
 
  2-15          (ii) If the aggregate amount of such credits 
  2-16          actually claimed and allowed for the immediately 
  2-17          preceding year exceeds the adjusted proceeds for 
  2-18          that year, the amount by which such credits exceed 
  2-19          such proceeds shall be subtracted from the amount of 
  2-20          the tobacco settlement proceeds for the following 
  2-21          year to arrive at the adjusted proceeds for that 
  2-22          year; or 
 
  2-23          (iii) If the aggregate amount of such credits 
  2-24          actually claimed and allowed for the immediately 
  2-25          preceding year is less than the adjusted proceeds 
  2-26          for that year, the amount by which such credits are 
  2-27          less than such proceeds shall be added to the amount 
  2-28          of the tobacco settlement proceeds for the following 
  2-29          year to arrive at the adjusted proceeds for that 
  2-30          year. 
 
  2-31      (2) The amount of the adjusted proceeds shall be divided 
  2-32      by the number of taxpayers subject to the tax imposed by 
  2-33      Code Section 48-7-20 who had a liability for that tax 
  2-34      for the year in which those adjusted proceeds were 
  2-35      received by the state.  The resulting quotient shall be 
  2-36      the amount of the tax credit for that year. 
 
  2-37    (d) In no event shall the amount of the tax credit exceed 
  2-38    the taxpayer's income tax liability, and any unused tax 
  2-39    credit shall not be allowed to be carried forward to apply 
  2-40    to the taxpayer's succeeding years' tax liability. No such 
  2-41    tax credit shall be allowed the taxpayer against any prior 
  2-42    years' tax liability. 
 
 
 
                                 -2- 
 
 
 
  3- 1    (e) The commissioner shall promulgate any rules and 
  3- 2    regulations necessary to implement and administer this 
  3- 3    Code section." 
 
  3- 4                           SECTION 2. 
 
  3- 5  This Act shall become effective upon its approval by the 
  3- 6  Governor or upon its becoming law without such approval and 
  3- 7  shall be applicable to all taxable years beginning during or 
  3- 8  after the year this state first receives tobacco settlement 
  3- 9  proceeds pursuant to State of Georgia, et al. v. Philip 
  3-10  Morris, Inc., et al., Civil Action #E-61692, V19/246 (Fulton 
  3-11  County Superior Court, December 9, 1998). 
 
  3-12                           SECTION 3. 
 
  3-13  All laws and parts of laws in conflict with this Act are 
  3-14  repealed. 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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