Establishes a small business tax credit

2 Co-sponsors

• David Carlucci
• Patrick M. Gallivan

BILL NUMBER:S7650

Title of bill

An act to amend the tax law, in relation to establishing a small business tax credit

Purpose

To create a small business personal income tax credit and reduce corporate franchise taxes for small businesses to encourage growth among this state's small businesses to help spur job creation.

Summary of provisions

20% TAX CUT FOR SMALL BUSINESSES: This bill would provide small businesses with a corporate tax rate cut from 6.5 percent to 5.2 percent - a 20 percent reduction. The corporate tax rate for small business applies to those businesses with entire net income base of not more than $290,000. It would also virtually eliminate the fixed dollar minimum for small businesses (those businesses with New York receipts of not more than $1 million). This reduction will save small businesses $20 million in SFY 2012-13 and $49 million on an annual basis.

Small business jobs credit

Provides a credit of 10% of business income for about 800,000 small businesses that have at least one employee, have business income of less than $250,000, and that file under the personal income tax. This tax credit would save small businesses $80 million annually.

Justification

This bill will deliver tax relief to small businesses to make New York State more economically competitive to encourage our small businesses to stay and expand.

Legislative history

This is a new bill.

Fiscal implications

This bill will save New York businesses $20 million this year.

Effective date

Effective immediately.