Reprinted
February 24, 2009
HOUSE BILL No. 1598
_____
DIGEST OF HB 1598
(Updated February 23, 2009 5:09 pm - DI 113)
Citations Affected: IC 6-3; IC 6-3.5; IC 6-6; noncode.
Synopsis: Logistics development incentives. Authorizes a county to
adopt an ordinance providing a temporary exemption from the wheel
tax for vehicles owned and used in the operation of twenty-first century
logistics enterprises at certain locations. Authorizes a county to adopt
an ordinance providing a temporary exemption from the commercial
vehicle excise tax for vehicles owned and used in the operation of
twenty-first century logistics enterprises at certain locations. Limits the
exemptions to vehicles owned and used at a new logistics enterprise or
in the expansion of the fleet of an existing logistics enterprise. Requires
the Indiana economic development corporation to certify the owner's
eligibility for an exemption. Modifies the adjusted gross income tax
exclusion for certain income derived from the exploitation of certain
patents by defining "development process", by allowing a clinical trial
that is part of a development process, if any, to take place outside
Indiana, and by providing that receipts attributable to the sale of a
qualified patent also include the fair market value of receipts allocable
to a qualified patent as the result of the sale of a trade or business.
Effective: July 1, 2009; January 1, 2010.
Reske
, Borror
, Pearson
, Michael
January 16, 2009, read first time and referred to Committee on Small Business and
Economic Development.
February 19, 2009, amended, reported _ Do Pass.
February 23, 2009, read second time, amended, ordered engrossed.
Reprinted
February 24, 2009
First Regular Session 116th General Assembly (2009)
PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana
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between statutes enacted by the 2008 Regular Session of the General Assembly.
HOUSE BILL No. 1598
A BILL FOR AN ACT to amend the Indiana Code concerning
taxation.
Be it enacted by the General Assembly of the State of Indiana:
SOURCE: IC 6-3-2-21.7; (09)HB1598.2.1. -->
SECTION 1. IC 6-3-2-21.7, AS ADDED BY P.L.223-2007,
SECTION 2, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
JANUARY 1, 2010]: Sec. 21.7. (a) This section applies to a qualified
patent issued to a taxpayer after December 31, 2007.
(b) As used in this section, "development process" with respect
to an invention has the meaning of the term under federal patent
law. The term includes both:
(1) the discovery and conception of the underlying invention;
and
(2) the reduction of the underlying invention to practice.
(b) (c) As used in this section, "invention" has the meaning set forth
in 35 U.S.C. 100(a).
(c) (d) As used in this section, "qualified patent" means:
(1) a utility patent issued under 35 U.S.C. 101; or
(2) a plant patent issued under 35 U.S.C. 161;
after December 31, 2007, for an invention resulting from a
development process conducted in Indiana,
regardless of the location
of an associated clinical trial, if any. The term does not include a
design patent issued under 35 U.S.C. 171.
(d) (e) As used in this section, "qualified taxpayer" means a taxpayer
that on the effective filing date of the claimed invention:
(1) is either:
(A) an individual or corporation, if the number of employees
of the individual or corporation, including affiliates as
specified in 13 CFR 121.103, does not exceed five hundred
(500) persons; or
(B) a nonprofit organization or nonprofit corporation as
specified in:
(i) 37 CFR 1.27(a)(3)(ii)(A) or 37 CFR 1.27(a)(3)(ii)(B); or
(ii) IC 23-17; and
(2) is domiciled in Indiana.
(e) (f) Subject to subsections (g) (h) and (h), (i), in determining
adjusted gross income or taxable income under IC 6-3-1-3.5 or
IC 6-5.5-1-2, a qualified taxpayer is entitled to an exemption from
taxation under IC 6-3-1 through IC 6-3-7 for the following:
(1) Licensing fees, royalties, milestone payments, or other
income received for the use of a qualified patent.
(2) Royalties received for the infringement of a qualified patent.
(3) Receipts from attributable to the sale of a qualified patent,
including the fair market value of receipts allocable to a
qualified patent as the result of the sale of a trade or business.
(4) Subject to subsection (f), (g), income from the taxpayer's own
use of the taxpayer's qualified patent to produce the claimed
invention.
(f) (g) The exemption provided by subsection (e)(4) (f)(4) may not
exceed the fair market value of the licensing fees or other income that
would be received by allowing use of the qualified taxpayer's qualified
patent by someone other than the taxpayer. The fair market value
referred to in this subsection must be determined in each taxable year
in which the qualified taxpayer claims an exemption under subsection
(e)(4). (f)(4).
(g) (h) The total amount of exemptions claimed under this section
by a qualified taxpayer in a taxable year may not exceed five million
dollars ($5,000,000).
(h) (i) A taxpayer may not claim an exemption under this section
with respect to a particular qualified patent for more than ten (10)
taxable years. Subject to the provisions of this section, the following
amount of the income, royalties, or receipts described in subsection (e)
(f) from a particular qualified patent is exempt:
(1) Fifty percent (50%) for each of the first five (5) taxable years
in which the exemption is claimed for the qualified patent.
(2) Forty percent (40%) for the sixth taxable year in which the
exemption is claimed for the qualified patent.
(3) Thirty percent (30%) for the seventh taxable year in which the
exemption is claimed for the qualified patent.
(4) Twenty percent (20%) for the eighth taxable year in which the
exemption is claimed for the qualified patent.
(5) Ten percent (10%) each year for the ninth and tenth taxable
year in which the exemption is claimed for the qualified patent.
(6) No exemption under this section for the particular qualified
patent after the eleventh taxable year in which the exemption is
claimed for the qualified patent.
(i) (j) To receive the exemption provided by this section, a qualified
taxpayer must claim the exemption on the qualified taxpayer's annual
state tax return or returns in the manner prescribed by the department.
The qualified taxpayer shall submit to the department all information
that the department determines is necessary for the determination of the
exemption provided by this section.
(j) (k) On or before December 1 of each year, the department shall
provide an evaluation report to the legislative council, the budget
committee, and the Indiana economic development corporation. The
evaluation report must contain the following:
(1) The number of taxpayers claiming an exemption under this
section.
(2) The sum of all the exemptions claimed under this section.
(3) The North American Industry Classification System code for
each taxpayer claiming an exemption under this section.
(4) Any other information the department considers appropriate,
including the number of qualified patents for which an exemption
was claimed under this section.
The report required under this subsection must be in an electronic
format under IC 5-14-6.
SOURCE: IC 6-3.5-5-1.5; (09)HB1598.2.2. -->
SECTION 2. IC 6-3.5-5-1.5 IS ADDED TO THE INDIANA CODE
AS A
NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY
1, 2009]:
Sec. 1.5. (a) As used in this chapter, "adopting county"
means a county that adopts an exemption ordinance under section
3.5(a) of this chapter.
(b) As used in this chapter unless the context clearly denotes
otherwise, "corporation" refers to the Indiana economic
development corporation established by IC 5-28-3-1.
(c) As used in this chapter, "qualified location" refers to a site
located in an adopting county that satisfies either of the following
requirements:
(1) The site is located not more than three (3) miles from:
(A) an interstate highway other than Interstate Highway
465;
(B) an airport;
(C) a port;
(D) a freight railroad depot; (E) a railroad yard;
(F) a classification yard;
(G) an intermodal port; or
(H) a commuter rail station.
(2) The site is a brownfield (as defined in IC 13-11-2-19.3).
(d) As used in this chapter, "qualified logistics enterprise"
refers to a business enterprise engaged in twenty-first century
logistics (as described in IC 5-28-10-4(4)).
(e) As used in this chapter, "qualified vehicle" refers to a
commercial motor vehicle that is:
(1) owned by a person who operates a qualified logistics
enterprise;
(2) registered for use in Indiana; and
(3) primarily used at a qualified location.
SOURCE: IC 6-3.5-5-3.5; (09)HB1598.2.3. -->
SECTION 3. IC 6-3.5-5-3.5 IS ADDED TO THE INDIANA CODE
AS A
NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY
1, 2009]:
Sec. 3.5. (a) This section applies to a qualified vehicle
placed into service in a county that adopts an exemption ordinance
under this subsection for a registration year beginning after
December 31, 2009, and ending before January 1, 2015. A county
fiscal body may provide a temporary exemption from the tax
imposed under this chapter by adopting an exemption ordinance
after June 30, 2009, and before November 1, 2009. The county
fiscal body shall send a certified copy of an ordinance adopted
under this subsection to the bureau, the department, and the
corporation.
(b) Subject to section 3.7 of this chapter, the owner of a qualified
vehicle may claim an exemption under this section in an adopting
county if:
(1) the qualified vehicle is used at a qualified logistics
enterprise that commences operations at a qualified location
after December 31, 2009; or
(2) the qualified vehicle is purchased as part of a fleet
expansion by an owner who is engaged in a qualified logistics
enterprise in operation at a qualified location before January
1, 2010.
(c) A qualified vehicle in an adopting county is exempt from the
tax imposed by this chapter for the first five (5) registration years
that the qualified vehicle is used at the owner's qualified logistics
enterprise.
(d) The exemption provided by this section does not excuse a
qualified vehicle from the registration requirements of the
International Registration Plan or IC 9-18.
(e) Any business that substantially reduces or ceases an
operation located in Indiana and outside a qualified location in
order to relocate in a qualified location in an adopting county is
disqualified from receiving an exemption under this section.
SOURCE: IC 6-3.5-5-3.7; (09)HB1598.2.4. -->
SECTION 4. IC 6-3.5-5-3.7 IS ADDED TO THE INDIANA CODE
AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY
1, 2009]: Sec. 3.7. (a) The owner of a qualified vehicle in an
adopting county may not claim an exemption under section 3.5 of
this chapter unless the corporation determines that owner is
eligible to receive an exemption under section 3.5 of this chapter.
If the corporation determines that the owner of the vehicle is
eligible for an exemption under section 3.5 of this chapter, the
corporation shall issue a certificate of eligibility to the owner of the
commercial vehicle.
(b) The exemption may be claimed for each registration year on
forms prescribed by the department or the bureau, whichever is
appropriate.
(c) To claim an exemption under this section, the owner of a
qualified vehicle must submit to the department or the bureau,
whichever is appropriate, the following documents when
registering the vehicle:
(1) A copy of the certificate of eligibility issued under
subsection (a).
(2) The form required by subsection (b).
(d) Subject to section 3.5(c) through 3.5(d) of this chapter, an
exemption may be claimed under section 3.5 of this chapter for a
registration year that begins after December 31, 2009.
SOURCE: IC 6-3.5-5-4; (09)HB1598.2.5. -->
SECTION 5. IC 6-3.5-5-4 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2009]: Sec. 4. A vehicle is exempt
from the wheel tax imposed under this chapter if the vehicle is:
(1) owned by this state;
(2) owned by a state agency of this state;
(3) owned by a political subdivision of this state;
(4) subject to the annual license excise surtax imposed under
IC 6-3.5-4; or
(5) a bus owned and operated by a religious or nonprofit youth
organization and used to haul persons to religious services or for
the benefit of their members; or
(6) subject to section 3.5 of this chapter.
SOURCE: IC 6-6-5.5-1.5; (09)HB1598.2.6. -->
SECTION 6. IC 6-6-5.5-1.5 IS ADDED TO THE INDIANA CODE
AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY
1, 2009]: Sec. 1.5. (a) As used in this chapter, "adopting county"
means a county that adopts an exemption ordinance under section
3.5(a) of this chapter.
(b) As used in this chapter unless the context clearly denotes
otherwise, "corporation" refers to the Indiana economic
development corporation established by IC 5-28-3-1.
(c) As used in this chapter, "qualified location" refers to a site
located in an adopting county that satisfies either of the following
requirements:
(1) The site is located not more than three (3) miles from:
(A) an interstate highway other than Interstate Highway
465;
(B) an airport;
(C) a port;
(D) a freight railroad depot;
(E) a railroad yard;
(F) a classification yard;
(G) an intermodal port; or
(H) a commuter rail station.
(2) The site is a brownfield (as defined in IC 13-11-2-19.3).
(d) As used in this chapter, "qualified logistics enterprise"
refers to a business enterprise engaged in twenty-first century
logistics (as described in IC 5-28-10-4(4)).
(e) As used in this chapter, "qualified vehicle" refers to a
commercial vehicle that is:
(1) owned by a person who operates a qualified logistics
enterprise;
(2) registered for use in Indiana; and
(3) primarily used at a qualified location.
SOURCE: IC 6-6-5.5-3; (09)HB1598.2.7. -->
SECTION 7. IC 6-6-5.5-3 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2009]: Sec. 3. (a) Except as
provided in section 3.5 of this chapter, there is imposed an annual
license excise tax upon commercial vehicles, which tax shall be in lieu
of the ad valorem property tax levied for state or local purposes, but in
addition to any registration fees imposed on such vehicles.
(b) Owners of commercial vehicles paying an apportioned
registration to the state under the International Registration Plan shall
pay an apportioned excise tax calculated by dividing in-state actual
miles by total fleet miles generated during the preceding year. If
in-state miles are estimated for purposes of proportional registration,
these miles are divided by total actual and estimated fleet miles.
(c) The tax imposed by this chapter is a listed tax and subject to the
provisions of IC 6-8.1.
(d) No commercial vehicle subject to taxation under this chapter
shall be assessed as personal property for the purpose of the assessment
and levy of personal property taxes or shall be subject to ad valorem
taxes first due and payable in 2001 or thereafter, whether or not such
vehicle is in fact registered pursuant to the motor vehicle registration
laws. No person shall be required to give proof of the payment of ad
valorem property taxes as a condition to the registration of any vehicle
that is subject to the tax imposed by this chapter.
SOURCE: IC 6-6-5.5-3.5; (09)HB1598.2.8. -->
SECTION 8. IC 6-6-5.5-3.5 IS ADDED TO THE INDIANA CODE
AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY
1, 2009]: Sec. 3.5. (a) This section applies to a qualified vehicle
placed into service in a county that adopts an exemption ordinance
under this subsection for a registration year beginning after
December 31, 2009, and ending before January 1, 2015. A county
fiscal body may provide a temporary exemption from the tax
imposed under this chapter by adopting an exemption ordinance
after June 30, 2009, and before November 1, 2009. The county
fiscal body shall send a certified copy of an ordinance adopted
under this subsection to the bureau, the department, and the
corporation.
(b) Subject to section 3.7 of this chapter, the owner of a qualified
vehicle may claim an exemption under this section in an adopting
county if:
(1) the qualified vehicle is used at a qualified logistics
enterprise that commences operations at a qualified location
after December 31, 2009; or
(2) the qualified vehicle is purchased as part of a fleet
expansion by an owner who is engaged in a qualified logistics
enterprise in operation at a qualified location before January
1, 2010.
(c) A qualified vehicle in an adopting county is exempt from the
tax imposed by section 3 of this chapter for the first five (5)
registration years that the qualified vehicle is used at the owner's
qualified logistics enterprise.
(d) The exemption provided by this section does not excuse a
qualified vehicle from the registration requirements of the
International Registration Plan or IC 9-18.
(e) Any business that substantially reduces or ceases an
operation located in Indiana and outside a qualified location in
order to relocate in a qualified location in an adopting county is
disqualified from receiving an exemption under this section.
SOURCE: IC 6-6-5.5-3.7; (09)HB1598.2.9. -->
SECTION 9. IC 6-6-5.5-3.7 IS ADDED TO THE INDIANA CODE
AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY
1, 2009]: Sec. 3.7. (a) The owner of a qualified vehicle in an
adopting county may not claim an exemption under section 3.5 of
this chapter unless the corporation determines that owner is
eligible to receive an exemption under section 3.5 of this chapter.
If the corporation determines that the owner of the vehicle is
eligible for an exemption under section 3.5 of this chapter, the
corporation shall issue a certificate of eligibility to the owner of the
commercial vehicle.
(b) The exemption may be claimed for each registration year on
forms prescribed by the department or the bureau, whichever is
appropriate.
(c) To claim an exemption under this section, the owner of a
qualified vehicle must submit to the department or the bureau,
whichever is appropriate, the following documents when
registering the vehicle:
(1) A copy of the certificate of eligibility issued under
subsection (a).
(2) The form required by subsection (b).
(d) Subject to section 3.5(c) through 3.5(d) of this chapter, an
exemption may be claimed under section 3.5 of this chapter for a
registration year that begins after December 31, 2009.
SOURCE: ; (09)HB1598.2.10. -->
SECTION 10. [EFFECTIVE JANUARY 1, 2010]
IC 6-3-2-21.7, as
amended by this act, applies only to taxable years beginning after
December 31, 2009.