Citations Affected: IC 5-29; IC 6-2.5-6-17; IC 6-8.1-9-3.
Synopsis: Sales tax rebate for developing a tourist site. Authorizes the
office of tourism development to enter into an agreement for a state
sales tax rebate with the operator of a new tourism attraction.
Establishes the criteria for awarding rebates. Establishes procedures for
claiming rebates. Appropriates money to the department of state
revenue for the payment of rebates.
Effective: July 1, 2007.
January 11, 2007, read first time and referred to Committee on Small Business and
Economic Development.
A BILL FOR AN ACT to amend the Indiana Code concerning
taxation and to make an appropriation.
1, 2007]: Sec. 8. (a) "Tourism attraction" means any of the
following:
(1) A cultural or historic site.
(2) A recreation or entertainment facility.
(3) An area of natural phenomenon or scenic beauty.
(4) An entertainment destination center.
(b) The term does not include any of the following:
(1) A racetrack or satellite facility licensed under IC 4-31.
(2) A riverboat licensed under IC 4-33.
(3) A facility located in a professional sports development
area established under IC 36-7-31 or IC 36-7-31.3.
(4) A lodging or dining facility unless the facility is located in
an entertainment destination center.
(5) A retail facility other than a gift shop or other retail
operation that is operated as a subordinate part of an
entertainment destination center or other tourism attraction.
(6) A recreational facility that is not operated as a visitor
destination.
create new jobs in Indiana may apply to the office to enter into an
agreement for a state gross retail tax rebate under this chapter.
The director shall prescribe the form of the application.
Sec. 2. After receipt of an application, the office may enter into
an agreement with the applicant for a state gross retail tax rebate
under this chapter if the office determines that all the following
conditions exist:
(1) The applicant's tourism attraction project will create new
jobs that were not jobs previously performed by employees of
the applicant in Indiana.
(2) The applicant's tourism attraction project is economically
sound and will benefit the citizens of Indiana by increasing
opportunities for employment in Indiana and strengthening
the economy of Indiana.
(3) Receiving the state gross retail tax rebate is a major factor
in the applicant's decision to go forward with the tourism
attraction project, and not receiving the state gross retail tax
rebate will result in the applicant not creating new jobs in
Indiana.
(4) Awarding the state gross retail tax rebate will result in an
overall positive fiscal impact to the state, as certified by the
office of management and budget using the best available
data.
(5) The office determines that the applicant's total qualified
project costs will exceed five million dollars ($5,000,000).
(6) At least twenty-five percent (25%) of the visitors to the
applicant's tourism attraction will be residents of other states.
(7) The state gross retail tax rebate is not prohibited by
section 3 of this chapter.
Sec. 3. A person may not receive a state gross retail tax rebate
under this chapter for any jobs that the person relocates from one
(1) site in Indiana to another site in Indiana. Determinations under
this section shall be made by the office.
Sec. 4. The office shall enter into an agreement with a person
that is awarded a state gross retail tax rebate under this chapter
for a tourism attraction project. The agreement must include all
the following:
(1) A detailed description of the tourism attraction project
that is the subject of the agreement.
(2) A detailed listing of each retail merchant who makes or
will make retail transactions at the tourism attraction.
(3) A requirement that the person shall maintain operations
at the tourism attraction for at least two (2) years following
the last calendar year in which the person receives a state
gross retail tax rebate under this chapter. A taxpayer is
subject to an assessment under section 7 of this chapter for
noncompliance with the requirement described in this
subdivision.
(4) A requirement that the person shall provide written
notification to the director and the department of state
revenue not more than thirty (30) days after the person makes
or receives a proposal that would transfer the person's
obligations under this chapter or IC 6-2.5 to another person.
Sec. 5. The amount of a state gross retail tax rebate awarded
under this chapter for a particular calendar year is equal to the
amount determined under STEP SIX of the following formula:
STEP ONE: Determine the total amount of the person's
qualified project costs for the tourism attraction project that
is the subject of an agreement described in section 4 of this
chapter.
STEP TWO: Multiply the STEP ONE amount by twenty-five
percent (25%).
STEP THREE: Divide the STEP TWO result by ten (10).
STEP FOUR: Determine the total amount of state gross retail
taxes remitted by all retail merchants making retail
transactions at the tourism attraction in the preceding
calendar year.
STEP FIVE: Multiply the STEP FOUR amount by
twenty-five percent (25%).
STEP SIX: Determine the lesser of:
(A) the STEP THREE quotient; or
(B) the STEP FIVE result.
Sec. 6. (a) A person is first eligible to receive a state gross retail
tax rebate awarded under this chapter following the first full
calendar year of operations at the tourism attraction that is the
subject of an agreement entered into under section 4 of this
chapter.
(b) A person may not receive a state gross retail tax rebate
under this chapter for more than ten (10) calendar years.
(c) IC 6-2.5-6-17 applies to all state gross retail tax rebates
awarded under this chapter.
Sec. 7. If the department of state revenue or the office
determines that a person that has received a state gross retail tax
rebate under this chapter is not entitled to the rebate because of
the person's:
(1) noncompliance with the requirements of the person's state
gross retail tax rebate agreement; or
(2) failure to comply with all the provisions of this chapter;
the department or the office shall, after giving the person an
opportunity to explain the noncompliance, impose an assessment
on the person in an amount that may not exceed the sum of any
previously allowed state gross retail tax rebates under this chapter
together with interest and penalties required or permitted by law.
Sec. 8. (a) On or before July 1, the director shall annually
submit a report to the lieutenant governor on the state gross retail
tax rebate program under this chapter. The report must include:
(1) information on the number of agreements that were
entered into under this chapter during the preceding calendar
year;
(2) a description of the project that is the subject of each
agreement;
(3) an update on the status of projects under agreements
entered into before the preceding calendar year;
(4) an assessment of the effectiveness of the program in
creating new jobs in Indiana;
(5) an assessment of the effect of the program on state tax
revenues; and
(6) the sum of the state gross retail tax rebates awarded under
this chapter in the preceding calendar year.
(b) A copy of the report required under subsection (a) shall be
transmitted in an electronic format under IC 5-14-6 to the
executive director of the legislative services agency for distribution
to the members of the general assembly.