AN
ACT Relating to international services; adding a new section to chapter 82.04
RCW; adding a new section to chapter 48.14 RCW; and providing an effective
date.
BE IT ENACTED BY THE
LEGISLATURE OF THE STATE OF WASHINGTON:
NEW
SECTION. Sec. 1. A
new section is added to chapter 82.04 RCW to read as follows:
(1)
There may be credited against the tax imposed by this chapter, an amount equal
to five percent of the qualified payroll, by a business that is:
(a)
Located within a designated community empowerment zone; and
(b)
Engaged in the business of providing selected international services.
(2)
In order to claim the tax credit under this section the business must:
(a)
Expend an amount, averaged over the most recent five-year period, equal or
greater than twenty percent of the tax credit on training of empowerment zone
employees;
(b)
Provide internship positions in conjunction with a targeted program of study
offered by a local institution of higher education or vocational-technical
school designed to provide experience relevant to the activities of the
business;
(c)
Provide summer employment opportunities in conjunction with the local high
schools, that is targeted to high school aged youth that reside within the
community empowerment zone, and that is designed to provide experience relevant
to the activities of the business; and
(d)
Hire, over the most recent five-year period, at least twenty-five percent of
the new employees located within the designated community empowerment zone from
applicants who reside, at the time of application, in the designated community
empowerment zone and continue to reside in the zone for five years after being
hired. Employees who pay housing rent or mortgage payments in excess of one
hundred twenty percent of the fair market rent, as determined under section 8
of the United States housing act of 1937, as amended (42 U.S.C. Sec. 1437f),
shall not be considered as residing in the zone for purposes of this subsection
(2)(d).
(3)
A business may not use the tax credit to relocate existing jobs in a community
in the state to the designated community empowerment zone.
(4)
The annual credit allowed under this section shall be limited to the amount of
tax imposed by this chapter.
(5)
As used in this section and section 2 of this act:
(a)
"Designated community empowerment zone" means a geographic area
approved under RCW 43.63A.700;
(b)
"Selected international services" means a business that:
(i)
Provides any of the following services related directly to the delivery of the
service outside the United States or on behalf of persons residing outside the
United States: Computer; data processing; information; legal; accounting; tax
preparation; design; engineering; architectural; business consulting; business
management; public relations and advertising; surveying; geological consulting;
real estate appraisal; and financial; and
(ii)
Is subject to taxation under RCW 82.04.290(2); and
(c)
"Qualified payroll" means the gross wages and benefits paid or
accrued, with respect to each employee of the business that is directly
involved in providing selected international services and was hired after the
effective date of this act, during the first five years of such employee's
employment within a designated community empowerment zone. Qualified payroll
includes only payroll that exceeds the previous year's annual payroll by an
amount in excess of the average growth rate in wages over the most recent five-year
period. The average growth in wages shall be calculated using gross wages but
not benefits.
NEW
SECTION. Sec. 2. A
new section is added to chapter 48.14 RCW to read as follows:
(1)
There may be credited against the tax imposed under RCW 48.14.020, an amount
equal to five percent of the qualified payroll, by a business that is:
(a)
Located within a designated community empowerment zone; and
(b)
Engaged in the business of providing selected international services.
(2)
In order to claim the tax credit under this section the business must:
(a)
Expend an amount, averaged over the most recent five-year period, equal or
greater than twenty percent of the tax credit on training of empowerment zone
employees;
(b)
Provide internship positions in conjunction with a targeted program of study
offered by a local institution of higher education or vocational-technical
school designed to provide experience relevant to the activities of the
business;
(c)
Provide summer employment opportunities in conjunction with the local high
schools, that is targeted to high school aged youth that reside within the
community empowerment zone, and that is designed to provide experience relevant
to the activities of the business; and
(d)
Hire, over the most recent five-year period, at least twenty percent of the
total employees located within the designated community empowerment zone from
applicants who reside, at the time of application, in the designated community
empowerment zone.
(3)
A business may not use the tax credit to relocate existing jobs in a community
in the state to the designated community empowerment zone.
(4)
The annual credit allowed under this section shall be limited to the amount of
tax imposed by this chapter.
(5)
As used in this section:
(a)
"Designated community empowerment zone" has the same meaning as in
section 1 of this act;
(b)
"Selected international services" has the same meaning as in section
1 of this act; and
(c)
"Qualified payroll" has the same meaning as in section 1 of this act.
NEW SECTION. Sec. 3. This
act takes effect July 1, 1998.
