BILL REQ. #:  H-0367.2 



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HOUSE BILL 1676
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State of Washington59th Legislature2005 Regular Session

By Representatives Roach, Buri, Kretz, Walsh, Ahern, Haler, McDonald, Rodne, Hinkle, Armstrong, Bailey, McCune, Alexander, Cox, Shabro, Condotta, Holmquist, Schindler, Serben, Buck, Clements, Skinner, Priest, Orcutt, Ericksen, Newhouse, Woods, Kristiansen, Dunn, Campbell, Strow, Crouse, Pearson, Simpson and Talcott

Read first time 02/01/2005.   Referred to Committee on Economic Development, Agriculture & Trade.



     AN ACT Relating to business and occupation tax exemptions for new businesses; adding a new section to chapter 82.04 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)(a) This chapter does not apply to a new business during the first twelve months of operation of the business.
     (b) This chapter does not apply to a new business during the first twenty-four months of operation of the business if the new business has less than twenty-five employment positions at the time it begins to engage in the normal course of business. During the next thirty-six months of operation of the business, the business is exempt from taxes due under this chapter according to the following schedule:

Year
% of Tax Exempt
375%
450%
525%
after year 50


     (2) A new business shall not take an exemption under this section during any reporting period in an amount that exceeds eight thousand three hundred thirty-three dollars, multiplied by the number of months in the reporting period.
     (3) As used in this section:
     (a)(i) "New business" means a business that obtained or was required to obtain a registration certificate under RCW 82.32.030 for the first time during the calendar year for which exemption is first claimed under this section.
     (ii) "New business" does not include:
     (A) A business that has been restructured, reorganized, or transferred, unless the majority of the activities to be conducted after restructuring, reorganization, or transferral are significantly different from the activities previously conducted;
     (B) A new branch location or other facility except by an existing out-of-state entity first doing business in this state;
     (C) A business that is substantially similar to a business currently operated, or operated within the past five years, by the same principals.
     (b) "Employment position" means a full-time, permanent employee of the new business.
     (4) A new business must file an application, in a form and manner required by the department, before taking a credit under this section. The department shall rule on the application within twenty days.

NEW SECTION.  Sec. 2   This act takes effect August 1, 2005.

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