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SB-996 Corporation taxes: tax rates.(2017-2018)

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Date Published: 04/05/2018 09:00 PM
SB996:v97#DOCUMENT

Amended  IN  Senate  April 05, 2018
Amended  IN  Senate  March 21, 2018

CALIFORNIA LEGISLATURE— 2017–2018 REGULAR SESSION

Senate Bill No. 996


Introduced by Senator Gaines
(Coauthors: Senators Berryhill and Morrell)

February 05, 2018


An act to amend Section 23151 of the Revenue and Taxation Code, relating to taxation, to take effect immediately, tax levy.


LEGISLATIVE COUNSEL'S DIGEST


SB 996, as amended, Gaines. Corporation taxes: tax rates.
The Corporation Tax Law imposes taxes measured by income at a rate of 8.84%, as specified. The Corporation Tax Law imposes a minimum franchise tax of $800, except as provided, on every corporation incorporated in this state, qualified to transact intrastate business in this state, or doing business in this state.
This bill, for taxable years beginning on or after January 1, 2018, would reduce the corporate tax rate to 6.84%.
This bill would take effect immediately as a tax levy.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: YES   Local Program: NO  

The people of the State of California do enact as follows:


SECTION 1.

 Section 23151 of the Revenue and Taxation Code is amended to read:

23151.
 (a) With the exception of banks and financial corporations, every each corporation doing business within the limits of this state and not expressly exempted from taxation by the provisions of the Constitution of this state or by this part, shall annually pay to the state, for the privilege of exercising its corporate franchises within this state, a tax according to or measured by its net income, to be computed at the rate of 7.6 percent upon the basis of its net income for the next preceding income year, or if greater, the minimum tax specified in Section 23153.
(b) For calendar or fiscal years ending after June 30, 1973, the rate of tax shall be 9 percent instead of 7.6 percent as provided by subdivision (a).
(c) For calendar or fiscal years ending in 1980 to 1986, inclusive, the rate of tax shall be 9.6 percent.
(d) For calendar or fiscal years ending in 1987 to 1996, inclusive, and for any income year beginning before January 1, 1997, the tax rate shall be 9.3 percent.
(e) For any income year beginning on or after January 1, 1997, and before the income year identified in subparagraph (A) of paragraph (1) of subdivision (f), the tax rate shall be 8.84 percent. The change in rate provided in this subdivision shall be made without proration otherwise required by Section 24251.
(f) (1) For the first taxable year beginning on or after January 1, 2000, the tax imposed under this section shall be the sum of both of the following:
(A) A tax according to or measured by net income, to be computed at the rate of 8.84 percent upon the basis of the net income for the next preceding income year, but not less than the minimum tax specified in Section 23153.
(B) A tax according to or measured by net income, to be computed at the rate of 8.84 percent upon the basis of the net income for the first taxable year beginning on or after January 1, 2000, but not less than the minimum tax specified in Section 23153.
(2) Except as provided in paragraph (1), for taxable years beginning on or after January 1, 2000, and before January 1, 2018, the tax imposed under this section shall be a tax according to or measured by net income, to be computed at the rate of 8.84 percent upon the basis of the net income for that taxable year, but not less than the minimum tax specified in Section 23153.
(g) For taxable years beginning on or after January 1, 2018, the tax imposed under this section shall be a tax according to or measured by net income, to be computed at the rate of 6.84 percent upon the basis of the net income for that taxable year, but not less than the minimum tax specified in Section 23153.

SEC. 2.

 This act provides for a tax levy within the meaning of Article IV of the California Constitution and shall go into immediate effect.