WSR 07-03-059

DEPARTMENT OF REVENUE


[ Filed January 15, 2007, 10:26 a.m. ]

November 28, 2006


Mr. Kyle Thiessen

The Code Reviser

Post Office Box 40551

Olympia, Washington 98504-0551


Re: SHB 3190 (Chapter 84, Laws of 2006) - Effective December 1, 2006


Dear Mr. Thiessen:


Based on information provided to the Department of Revenue (Department), the Department determined that the contingencies in SHB 3190 have been met. Therefore, the tax incentives provided in this act will take effect December 1, 2006. The incentives expire 12 years after the effective date.


What the Act Requires

&sqbul; Requires a single person to invest at least $350 million of actual expenditures in a semiconductor materials fabrication facility in Washington that produces 300 millimeter semiconductor wafers for sale.
&sqbul; Requires affected taxpayers to report annual employment data and to file the report and all returns electronically with the Department.
&sqbul; Requires the Department to determine the effective date of the act based on information provided by the investing taxpayer.
&sqbul; Requires the Department to provide notice of the effective date of the act to affected taxpayers, the Legislature, the Office of the Code Reviser, and others as deemed appropriate.
&sqbul; Requires the Department to report to the Legislature on the effectiveness of this act in years five and eleven.

What the Act Provides

&sqbul; Provides a preferential business and occupation (B&O) tax rate of 0.275 percent to manufacturers or processors-for-hire of semiconductor materials.
&sqbul; Provides a sales and use tax exemption for gases and chemicals used by a manufacturer or processor-for-hire in the production of semiconductor materials.

Thank you for the opportunity to notify you of the effective date of this act. If you have any questions or concerns, please contact me at (360) 586-3462.


Sincerely,

Cindi L. Holmstrom

Director, Department of Revenue

cc: The Honorable Joseph Zarelli, State Senate

The Honorable Margarita Prentice, State Senate

The Honorable Jim McIntire, House of Representatives

The Honorable Jeff Morris, House of Representatives

The Honorable Deb Wallace, House of Representatives

Bart Phillips, Columbia River Economic Development Council

Juli Wilkerson, Department of Community, Trade & Economic Development

Jim Schmidt, Office of Financial Management

Marc Baldwin, Office of the Governor

Washington State Code Reviser's Office