Bill > HB34

This bill establishes a new deduction for gross receipts tax, which is a tax on the total amount of money a business receives from sales. This deduction, intended to boost sales at small local businesses and restaurants, allows businesses to subtract receipts from retail sales of tangible personal property or food sold at a restaurant if the sale occurs on the Saturday immediately following Thanksgiving Day. To qualify, the seller must have been in operation for at least one year and, over the past five years, their average annual business income from all businesses they have an ownership stake in must be less than $2 million. Business income is defined as taxable income for federal income tax purposes, including interest from state or local bonds, and is treated as non-passive income or net earnings from self-employment. A restaurant is defined as an establishment with a kitchen that prepares and serves meals for on-premises consumption. The bill also mandates that the department of taxation compile an annual report on the deduction's effectiveness and cost, presenting it to legislative committees starting in 2019. This new deduction will be effective from July 1, 2016, until July 1, 2020.