Bill Text: NJ S2690 | 2020-2021 | Regular Session | Introduced
Bill Title: Prohibits imposition of CBT on certain foreign corporations by reason of employment of State residents who temporarily work remotely due to public health emergency.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2020-07-09 - Introduced in the Senate, Referred to Senate Budget and Appropriations Committee [S2690 Detail]
Download: New_Jersey-2020-S2690-Introduced.html
Sponsored by:
Senator TROY SINGLETON
District 7 (Burlington)
SYNOPSIS
Prohibits imposition of CBT on certain foreign corporations by reason of employment of State residents who temporarily work remotely due to public health emergency.
CURRENT VERSION OF TEXT
As introduced.
An Act prohibiting the imposition of the corporation business tax on certain foreign corporations by reason of their employment of State residents who temporarily work remotely due to a public health emergency, amending P.L.1945, c.162 (C.54:10A-1 et seq.).
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. Section 2 of P.L.1945, c.162 (C.54:10A-2) shall be amended to read as follows:
2. Every domestic or foreign corporation which is not hereinafter exempted shall pay an annual franchise tax for each year, as hereinafter provided, for the privilege of having or exercising its corporate franchise in this State, or for the privilege of deriving receipts from sources within this State, or for the privilege of engaging in contacts within this State, or for the privilege of doing business, employing or owning capital or property, or maintaining an office, in this State. And such franchise tax shall be in lieu of all other State, county or local taxation upon or measured by intangible personal property used in business by corporations liable to taxation under this act.
A foreign corporation shall not be deemed to be deriving receipts, engaging in contacts, doing business, employing or owning capital or property in the State, for the purposes of this act, by reason of (1) the maintenance of cash balances with banks or trust companies in this State, or (2) the ownership of shares of stock or securities in this State if such shares or securities are pledged as collateral security, or deposited with one or more banks or trust companies or brokers who are members of a recognized security exchange, in safekeeping or custody accounts, or (3) the taking of any action by any such bank or trust company or broker, which is incidental to the rendering of safekeeping or custodian service to such corporation, or (4) notwithstanding any provisions of this section to the contrary, the operation of a motor vehicle or motorbus operated over public highways or public places in this State for the carriage of passengers in transit from a location outside this State to a destination in this State and for the carriage of those passengers in transit from a location in this State to a location outside this State, or (5) the employment of a State resident who is temporarily working remotely from the State resident's domicile due to a public health emergency.
A taxpayer's exercise of its franchise in this State is subject to taxation in this State if the taxpayer's business activity in this State is sufficient to give this State jurisdiction to impose the tax under the Constitution and statutes of the United States.
As used in this section:
"Public health emergency" means an outbreak of infectious disease or pandemic for which an emergency is declared: (1) by the Governor during a state of emergency declared pursuant to P.L.1942, c.251 (C.App.A:9-33 et seq.), or a public health emergency declared pursuant to P.L.2005, c.222 (C.26:13-1 et seq.); (2) under the federal "Public Health Service Act," (42 U.S.C. s.201 et seq.); or (3) by the President of the United States as a public health emergency or major disaster under the "Robert T. Stafford Disaster Relief and Emergency Assistance Act," (42 U.S.C. s.5155).
(cf: P.L.2013, c.98)
2. The State Treasurer may adopt, pursuant to the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.), rules and regulations necessary to implement the provisions of this act.
3. This act shall take effect immediately.
STATEMENT
This bill prohibits the imposition of the corporation business tax on foreign (out-of-State) corporations whose only contact with the State of New Jersey is the employment of a State resident who is temporarily working from the State resident's domicile due to a public health emergency. As used in this bill, "public health emergency" means an outbreak of infectious disease or pandemic for which an emergency is declared: (1) by the Governor during a state of emergency declared pursuant to P.L.1942, c.251 (C.App.A:9-33 et seq.), or a public health emergency declared pursuant to P.L.2005, c.222 (C.26:13-1 et seq.); (2) under the federal "Public Health Service Act,"; (42 U.S.C. s.2101) or (3) by the President of the United States as a public health emergency or major disaster under the "Robert T. Stafford Disaster Relief and Emergency Assistance Act," (42 U.S.C. s.5155).
